Manifest Destiny and Other Key Components of American Economic Growth

America at the end of the 19th century was a place of rapid change and economic progress. The dilemma American’s faced was that they lived in an incredibly resource rich country, but lacked the means of production (machines and labourers) to exploit these resources. However, the developments of the second industrial revolution made production easier than ever, moving from small quantities of hand-made produce to standardised products that were mass produced by mechanised means. These products were now able to travel across the country on the new transcontinental railway system. This in turn led to a changing demographic shape of the country; rapid urbanisation, immigrants and big business were encouraged by a system of laissez-faire capitalism in governance. The ideology of Manifest Destiny underpinned this growth- the belief among these pioneers of capitalism that as Americans, they had every right and in fact a responsibility to expand across and exploit the resources of North America in their pursuit of the ideals of capitalism. Overall, the largest contributing factors to America's economic power at the turn of the century was the concept of Manifest Destiny, the resource rich land, and those who exploited those resources along with those they employed.

Manifest Destiny was a key component of American economic growth due to the territorial expansionism it advocated. It was a widely held belief in the US throughout the mid-late 19th century that its settlers were destined to expand across North America. It usually had 3 key themes: the virtue of the American people and their institutions; the mission to spread these institutions, thereby redeeming and remaking the world in the image of the US and; the destiny under God to do this work. The hubs of settlement in early-mid 19th century America were predominantly along the east coast due to its proximity to Europe, but rising rates of immigration necessitated more land for incoming arrivals. Consequently, many Americans advocated for new immigrants to settle the west and central areas (the Great Plains) of the continent. The phrase Manifest Destiny was coined for this reason by newspaper editor John O’Sullivan in an 1845 editorial which advocated for the annexation of Texas because it was “our manifest destiny to overspread the continent allotted by Providence for the free development of our yearly multiplying millions”. The best mechanism for this territorial expansion was the railway. Having inherited from Europe the technology of the early industrial revolution, Americans were quick to develop the technology of steam power and cheap methods of iron production in new directions. In 1862, Congress passed the Pacific Railway Act, which authorised the construction of the transcontinental railroads, also awarding private railway investors massive land grants to build upon (note the commercial nature of the project). In May 1869, the first transcontinental link joined the Union Pacific and the Central Pacific Railroads at Promontory Point, Utah. By 1884, four transcontinental lines were in operation. New settlements began to develop around the railway stations across the country, and by 1890 railways connected the west and east coast and their ports.

The benefits of this were revolutionary: goods produced could be transported to homes and businesses throughout the nation and overseas, telegraph lines followed the railways resulting in more efficient communication, and interstate travel was increasingly accessible, all of this promoting westward settlement. Between 1870 and 1900, 430 million acres of land were settled; more than had been occupied in all previous American history. This was also due to the 1862 Homestead Act. Congress used this act to set in motion a program of public land grants to encourage small farmers. 160 acres of public land (mostly situated on the Great Plains) were offered to settlers for a small registration fee on the condition they lived on the land continuously for five years and improved the land while they did so. In the first four years of the program, 15,000 homestead claims were approved. Some immigrants faced challenges in this program; many were unused to modern farming techniques, and some were not given arable land to work from. However, these homesteads created communities across North America on land that had been previously unsettled by anyone other than Native Americans. Over time, the increasing mechanisation of American agriculture replaced the aforementioned homesteads with a smaller number of larger farms, but many small towns established around the homesteads lived on. It must be noted that this expansionist philosophy which was beneficial to many new immigrants also resulted in the displacement of thousands of Native Americans. Over this period the Native American population declined rapidly, tribes lost much of their remaining land, and the nation’s native people became the poorest group in American society. However, the distress they were causing the Native Americans gave the new Americans little pause for thought in their relentless pursuit of economic progress. The results of the territorial expansion driven by the belief in manifest destiny gave America key economic opportunities both in mobility of goods and the amount of land at their disposal.

The vast expanses of land now in the hands of the American people also happened to be resource rich, and they were quick to use new technology to take advantage of these resources. The large amounts of arable land provided the first set of resources: agricultural produce. The distribution of fertile and accessible land meant Americans brought more land under cultivation between 1870 and 1900 (225 million acres) than they had since 1607 (189 million acres). Farmers abandoned their small, worn out farms in the east and developed new, larger and more fertile farms in the mid-west and west. The also made use of new innovations from the second industrial revolution- a single family with a reaper could increase acreage and thus production without large amounts of hired labour. Between 1860 and 1900, the number of Americans employed in the agricultural sector fell from over half to 40%, but agricultural productivity kept increasing, allowing the excess to be exported. What farmers sold abroad translated into savings and consumption at home that fuelled the nation’s industry.

The face of American industry was largely characterised by the natural resources found across the nation, the two most important of which were oil and coal. Commercial coal mining in the US had been occurring from as early as the 1740s, but it remained a small industry until the 1800s as early settlers preferred to use the plentiful supplies of wood. However, by the early 1800s, miners in Pennsylvania had begun extracting a higher carbon form of coal (known as anthracite) on an industrial scale. It quickly became a popular source of heating in various North-eastern cities, and by the 1840s, anthracite became the standard form of coal used throughout the Eastern seaboard. Throughout the middle of the century, the coal industry spread; by 1861, the coal mining industry had expanded to 20 states. The civil war then massively increased demand for coal (increasing prices by almost 50%). The new coalfields that opened as a result of this were now reached by railroads, and eventually railroads began purchasing coalfields directly to lease to mining companies. Following the second industrial revolution, new technology drove industrial change and progress as extraction of coal went underground and purification methods became standard. These cleaning methods produced coke, a fuel with few impurities and a high carbon content, crucial to making iron and steel. The increase in coal mining meant national production reached 80 million tons by 1880. Oil was a similar story, with the domestic petroleum industry beginning in 1859 with a 69ft deep well in Western Pennsylvania. The oil found in such wells was refined into kerosene, which was cheaper than whale oil and far safer than the popular but explosive fuel, camphene. John D. Rockefeller also founded his company Standard Oil in 1859 in Cleveland, Ohio. Drilling expanded to other states, eventually reaching California in 1892. However, the pipelines (owned mostly by Standard Oil) were the most important mechanism for transportation of oil. By 1885, Rockefeller had brought the cost of oil from 58 cents down to 8 cents a gallon, allowing everyday people to illuminate their homes and companies to illuminate workplaces, allowing work into the evening and early night which contributed to greater productivity. Some saw Edison’s 1879 incandescent light as the end of the oil industry, but with the advent of the automobiles, surplus was not an issue. By 1909, oil production in the United States more than equalled the rest of the world combined, and they were the largest supplier of oil to other countries while still supporting their own needs. American productivity in the use of their resources allowed it to be the world’s greatest agricultural economy while it became the world’s largest industrial producer.

Despite the land, natural resources and new technology available, it cannot be denied that it was the people that ultimately made America’s economy a force to be reckoned with. As previously mentioned, American’s faced a unique dilemma of possessing land, resources and machinery, but a dearth of available labour. However, the enticing young nation seemed full of opportunity to many, resulting in a flood of immigrants into the country. Along with the children of farmers moving to larger cities (urbanisation), the net immigration between 1877 and 1900 was as large as 7,248,000 people. Before 1800, immigrants came largely from Western Europe and China, but by the end of the century southern and eastern Europeans became the biggest sources of immigrants. Most immigrants came to America for economic opportunity; cheap land and relatively high wages (compared to their countries of origin) were available regardless of citizenship, especially through the Homestead Act. Early arrivals wrote home to bring family and friends to the US, forming chains and networks of immigrants. At the same time, the rapid rise of American industry had brought about a massive increase in the prevalence of wage labour. In 1873, for the first time in America’s history, wage labourers outnumbered the self-employed, and by the 1880s these labourers were becoming employees of increasingly large corporations. As the Massachusetts Bureau of Statistics and Labour declared at the time, wage labour was universal: “a system more widely diffused than any form of religion, or of government, or indeed, of any language”. Skilled workers struggled to maintain their position throughout the 1880s, as the high wages for skilled workers led employees to seek ways to replace skilled with unskilled or semi-skilled workers. Mechanisation proved the best tactic for deskilling work and lowering wages, with Henry Ford’s assembly line being the most widely cited example. This unskilled work was taken up largely by immigrants, providing America with her much-needed labour to supplement land and capital. The fourth factor of production, entrepreneurship, is one that several individuals also took to new heights in the late 19th century. Through shrewd business practices, certain early investors in areas such as oil and steel as well as corporate finance figures were able to form immense business empires. John D Rockefeller is a prime example: having invested in oil with his company Standard Oil, he went about buying out his competitors, in 1881 placing all of Standard and affiliates into the first major US trust. By 1882, Standard Oil had a near monopoly, owning 90% of the nation’s oil refineries and pipelines. Under the government’s laissez-faire economic rule, there were no business taxes, nor was there any minimum wage (which wasn’t set in place until the New Deal). In addition to this, despite legislation like the 1890 Sherman Anti-Trust Act, there was little support among powerful figures to regulate big business (as many of these figures benefitted from it), so trusts became ever more prevalent, reducing fair business competition. As such, a series of millionaires and billionaires became the most influential figures in the nation as the head of massive, sometimes even international conglomerates. These companies provided work for unskilled labourers and fed the ever-growing consumer culture throughout the country whilst trading surplus overseas. Overall, the influx of labour due to immigration and the exploitation of resources by a few shrewd individuals ensured the success of the American economy as the 20th century approached.

By 1900, the US controlled 50% of the world’s manufacturing capacity, and was expanding its economic interests around the globe, emerging as a world power. It is true that the US made such great gains partially because it ran fast in a slow race- the entire period from 1873-1900 was known as the long depression in Western Europe. However, America’s economic clout was mostly due to the way Americans used the resources and land they had discovered. It is certain that the settlers were lucky to have discovered such a resource rich continent with arable lands, but it was the pioneering spirit of these new American’s in territorial expansion and harnessing of resources that made America an economic superpower by the turn of the century.