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Enslaved Financing of Southern Industry: The Nesbitt Manufacturing Company of South Carolina, 1836–1850

Published online by Cambridge University Press:  04 February 2021

SHARON ANN MURPHY
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Abstract

Incorporated on the eve of the Panic of 1837, the Nesbitt Manufacturing Company of South Carolina owned and hired enslaved individuals to labor in their ironworks, but they also leveraged the market value of this enslaved property by exchanging them for shares of company stock and offering them as collateral in loan contracts. These slaveholders actively experimented with increasingly sophisticated financial tools and institutions in order to facilitate investment, market exchange, and profit maximization within the system of enslavement. Although historians have examined the role of enslaved labor in industrial concerns, they have largely ignored their role in the financing of these operations. Understanding the multiple ways that southerners were turning enslaved property into liquid, flexible financial assets is essential to understanding the depth and breadth of the system of enslavement. In doing so, we can move beyond questions of whether slavery was compatible with industrialization specifically and capitalism more broadly, to an understanding of how slavery and capitalism interacted to promote southern economic development in the antebellum period. At the same time, the experience of the Nesbitt Company reveals the limits of enslaved financing. The aftermath of the Panic of 1837 demonstrated that the market value of enslaved property was much more volatile than enslavers cared to admit. Although southerners could often endure this volatility in the case of enslaved laborers working on plantations or in factories, it made the financialization of slavery a much riskier endeavor for an emerging industrial regime.

Keywords

financeUS 19thindustrial slavery
Type
Article
Information
Enterprise & Society , Volume 23 , Issue 3 , September 2022 , pp. 746 - 789
Copyright
© The Author(s), 2021. Published by Cambridge University Press on behalf of the Business History Conference. All rights reserved.

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References

Bibliography of Works Cited

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Berry, Daina Ramey. The Price for Their Pound of Flesh: The Value of the Enslaved, from Womb to Grave, in the Building of a Nation . Boston: Beacon Press, 2017.Google Scholar
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Delfino, Susanna, and Gillespie, Michele, eds. Global Perspectives on Industrial Transformation in the American South . Columbia: University of Missouri Press, 2005.Google Scholar
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Kilbourne, Richard Holcombe Jr. Slave Agriculture and Financial Markets in Antebellum America: The Bank of the United States in Mississippi, 1831–1852 . London: Pickering & Chatto, 2006.Google Scholar
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McGrane, Reginald C. Foreign Bondholders and American State Debts. New York: Macmillan Company, 1935.Google Scholar
Murphy, Sharon Ann. Other People’s Money: How Banking Worked in the Early American Republic. Baltimore: The Johns Hopkins University Press, 2017.Google Scholar
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Starobin, Robert S. Industrial Slavery in the Old South . New York: Oxford University Press, 1970.Google Scholar
Takagi, Midori. Rearing Wolves to Our Own Destruction: Slavery in Richmond Virginia, 1782–1865 . Charlottesville: University of Virginia Press, 1999.Google Scholar
Wright, Gavin. Slavery and American Economic Development . Baton Rouge: Louisiana State University Press, 2006.Google Scholar
Zakim, Michael, and Kornblith, Gary J., eds. Capitalism Takes Command: The Social Transformation of Nineteenth-Century America . Chicago: University of Chicago Press, 2012.Google Scholar
“An Act to Alter the Name and Amend the Charter of the Nesbitt Iron Manufacturing Company.” In The Statutes at Large of South Carolina, 451–453. Columbia, SC: Johnston, A. S.,1840.Google Scholar
Baptist, Edward. “Toxic Debt, Liar Loans, Collateralized and Securitized Human Beings, and the Panic of 1837.” In Capitalism Takes Command: The Social Transformation of Nineteenth-Century America, edited by Zakim, Michael and Kornblith, Gary J., 69–92. Chicago: University of Chicago Press, 2012.Google Scholar
Barnes, L. Diane. “Industry and Its Laborers, Free and Slave in Late-Antebellum Virginia.” In The Old South’s Modern Worlds: Slavery, Region, and Nation in the Age of Progress, edited by Barnes, L. Diane, Schoen, Brian, and Towers, Frank, 189–206. Oxford: Oxford University Press, 2011.Google Scholar
Dorfman, Joseph. “A Note on the Interpenetration of Anglo-American Finance, 1837–1841.” Journal of Economic History 11, no. 2 (Spring 1851): 144–145.Google Scholar
Forret, Jeff. “‘How Deeply They Weed into the Pockets’: Slave Traders, Bank Speculators, and the Anatomy of a Chesapeake Wildcat, 1840–1843.” Journal of the Early Republic 39, no. 4 (Winter 2019): 709–736.CrossRefGoogle Scholar
“John Taylor and his Descendants.” South Carolina Historical and Genealogical Magazine 8, no. 2 (April 1907): 95–119.Google Scholar
Kaye, Anthony E. “The Second Slavery: Modernity in the Nineteenth-Century South and the Atlantic World.” Journal of Southern History 75, no. 3 (2009): 627–650.Google Scholar
Kotlikoff, Laurence J. “Quantitative Description of the New Orleans Slave Market, 1804 to 1862.” In Without Consent or Contract: Technical Papers on Slavery, vol. 1, edited by Fogel, Robert W. and Engerman, Stanley L., 31–53. New York: W. W. Norton, 1992.Google Scholar
Lander, Ernest M. Jr. “The Iron Industry in Ante-Bellum South Carolina.” The Journal of Southern History 20, no. 3 (August 1954): 337–355.CrossRefGoogle Scholar
Martin, Bonnie. “Slavery’s Invisible Engine: Mortgaging Human Property.” The Journal of Southern History 76, no. 4 (November 2010): 817–866.Google Scholar
Mihm, Stephen. “Follow the Money: The Return of Finance in the Early American Republic.” Journal of the Early Republic 36, no. 4 (Winter 2016): 783–804.CrossRefGoogle Scholar
Murphy, Sharon Ann. “Collateral Damage: The Impact of Foreclosure on Enslaved People during the Panic.” Journal of the Early Republic 40, no. 4 (Winter 2020): 691–696.CrossRefGoogle Scholar
Murphy, Sharon Ann. “The Financialization of Enslavement by the First and Second Banks of the United States.” Journal of Southern History (forthcoming September 2021).CrossRefGoogle Scholar
Murphy, Sharon Ann. “Securing Human Property: Slavery, Life Insurance, and Industrialization in the Upper South.” Journal of the Early Republic 25, no. 4 (Winter 2005): 615–652.CrossRefGoogle Scholar
Ng, Kenneth. “Free Banking Laws and Barriers to Entry in Banking, 1838–1860.” Journal of Economic History 48, no. 4 (December 1988): 877–889.CrossRefGoogle Scholar
Olmstead, Alan, and Rhode, Paul. “Biological Innovation and Productivity in the Antebellum Cotton Economy.” Journal of Economic History 68, no. 4 (December 2008): 1123–1171.CrossRefGoogle Scholar
Rothman, Joshua D. “The Contours of Cotton Capitalism: Speculation, Slavery and Economic Panic in Mississippi, 1832–1841.” In Slavery’s Capitalism: A New History of American Economic Development, edited by Beckert, Sven and Rockman, Seth, 122–145. Philadelphia: University of Pennsylvania Press, 2016.CrossRefGoogle Scholar
Vollmers, Gloria. “Industrial Slavery in the United States: The North Carolina Turpentine Industry, 1849–61.” Accounting, Business & Financial History 13, no. 3 (November 2003): 369–392.Google Scholar
Watson, Alan D. “North Carolina and Internal Improvements, 1783–1861: The Case of Inland Navigation.” North Carolina Historical Review 74, no. 1 (January 1997): 52–57.Google Scholar
Wright, Robert E., and Kingston, Christopher. “Corporate Insurers in Antebellum America.” The Business History Review 86, no. 3 (Autumn 2012): 452–453.CrossRefGoogle Scholar
Charleston Courier Google Scholar
Charleston Daily Courier Google Scholar
Charleston Mercury Google Scholar
Cheraw Advertiser Google Scholar
Edgefield Advertiser Google Scholar
North Carolina Standard Google Scholar
Franklin H. Elmore Papers, Library of Congress (Elmore Papers)Google Scholar
Franklin Harper Elmore Papers, 1833–1936, Southern Historical Collection, University of North Carolina at Chapel Hill (Elmore Papers UNC)Google Scholar
Baptist, Edward. The Half Has Never Been Told: Slavery and the Making of American Capitalism . New York: Basic Books, 2014.Google Scholar
Barnes, L. Diane, Schoen, Brian, and Towers, Frank, eds. The Old South’s Modern Worlds: Slavery, Region, and Nation in the Age of Progress . Oxford: Oxford University Press, 2011.Google Scholar
Beckert, Sven. Empire of Cotton: A Global History . Cambridge, MA: Harvard University Press, 2015.Google Scholar
Beckert, Sven, and Rockman, Seth, eds. Slavery’s Capitalism: A New History of American Economic Development . Philadelphia: University of Pennsylvania Press, 2016.CrossRefGoogle Scholar
Berry, Daina Ramey. The Price for Their Pound of Flesh: The Value of the Enslaved, from Womb to Grave, in the Building of a Nation . Boston: Beacon Press, 2017.Google Scholar
Bezís-Selfa, John. Forging America: Ironworkers, Adventurers, and the Industrious Revolution . Ithaca, NY: Cornell University Press, 2004.Google Scholar
Conrad, Alfred H., and Meyer, John R.. The Economics of Slavery . Chicago: Aldine Publishing Company, 1964.Google Scholar
Cronon, William. Nature’s Metropolis: Chicago and the Great West . New York: W. W. Norton, 1991 . Google Scholar
Delfino, Susanna, and Gillespie, Michele, eds. Global Perspectives on Industrial Transformation in the American South . Columbia: University of Missouri Press, 2005.Google Scholar
Dew, Charles B. Bond of Iron: Master and Slave at Buffalo Forge. New York: W. W. Norton, 1994.Google Scholar
Follett, Richard. The Sugar Masters: Planters and Slaves in Louisiana’s Cane World, 1820–1860 . Baton Rouge: Louisiana State University Press, 2005.Google Scholar
Ford, Lacy K. Origins of Southern Radicalism: The South Carolina Upcountry 1800–1860. New York: Oxford University Press, 1988.Google Scholar
Fuentes, Marisa J. Dispossessed Lives: Enslaved Women, Violence, and the Archive. Philadelphia: University of Pennsylvania Press, 2016.Google Scholar
Goldin, Claudia Dale. Urban Slavery in the American South 1820–1860 . Chicago: University of Chicago Press, 1976.Google Scholar
Hahn, Barbara. Making Tobacco Bright: Creating an American Commodity, 1617–1937 . Baltimore: The Johns Hopkins University Press, 2011.Google Scholar
Kilbourne, Richard Holcombe Jr. Debt, Investment, Slaves: Credit Relations in East Feliciana Parish, Louisiana 1825–1885 . Tuscaloosa: University of Alabama Press, 1995.Google Scholar
Kilbourne, Richard Holcombe Jr. Slave Agriculture and Financial Markets in Antebellum America: The Bank of the United States in Mississippi, 1831–1852 . London: Pickering & Chatto, 2006.Google Scholar
Lepler, Jessica M. The Many Panics of 1837: People, Politics, and the Creation of a Transatlantic Financial Crisis . New York: Cambridge University Press, 2013.CrossRefGoogle Scholar
Lesesne, J. Mauldin. The Bank of the State of South Carolina: A General and Political History . Columbia: University of South Carolina Press, 1970.Google Scholar
Lewis, Ronald L. Coal, Iron, and Slaves: Industrial Slavery in Maryland and Virginia, 1715–1865 . Westport, CT: Greenwood Press, 1979.Google Scholar
McGrane, Reginald C. Foreign Bondholders and American State Debts. New York: Macmillan Company, 1935.Google Scholar
Murphy, Sharon Ann. Other People’s Money: How Banking Worked in the Early American Republic. Baltimore: The Johns Hopkins University Press, 2017.Google Scholar
Nelson, Scott Reynolds. A Nation of Deadbeats: An Uncommon History of America’s Financial Disasters . New York: Knopf, 2012.Google Scholar
O’Neall, John Belton. Biographical Sketch of the Bench and Bar of South Carolina. Vol. 2. Charleston, SC: S. G. Courtenay & Co., 1859.Google Scholar
Peterson, Merrill D. The Great Triumvirate: Webster, Clay, and Calhoun. New York: Oxford University Press, 1987.Google Scholar
Phillips, Ulrich B. Life and Labor in the Old South . Boston: Little, Brown, and Company, 1929.Google Scholar
Rosenthal, Caitlin. Accounting for Slavery: Masters and Management. Cambridge, MA: Harvard University Press, 2018.CrossRefGoogle Scholar
Schermerhorn, Calvin. The Business of Slavery and the Rise of American Capitalism, 1815–1860 . New Haven, CT: Yale University Press, 2015.CrossRefGoogle Scholar
Smallwood, Stephanie E. Saltwater Slavery: A Middle Passage from Africa to American Diaspora. Cambridge, MA: Harvard University Press, 2007.CrossRefGoogle Scholar
Starobin, Robert S. Industrial Slavery in the Old South . New York: Oxford University Press, 1970.Google Scholar
Takagi, Midori. Rearing Wolves to Our Own Destruction: Slavery in Richmond Virginia, 1782–1865 . Charlottesville: University of Virginia Press, 1999.Google Scholar
Wright, Gavin. Slavery and American Economic Development . Baton Rouge: Louisiana State University Press, 2006.Google Scholar
Zakim, Michael, and Kornblith, Gary J., eds. Capitalism Takes Command: The Social Transformation of Nineteenth-Century America . Chicago: University of Chicago Press, 2012.Google Scholar
“An Act to Alter the Name and Amend the Charter of the Nesbitt Iron Manufacturing Company.” In The Statutes at Large of South Carolina, 451–453. Columbia, SC: Johnston, A. S.,1840.Google Scholar
Baptist, Edward. “Toxic Debt, Liar Loans, Collateralized and Securitized Human Beings, and the Panic of 1837.” In Capitalism Takes Command: The Social Transformation of Nineteenth-Century America, edited by Zakim, Michael and Kornblith, Gary J., 69–92. Chicago: University of Chicago Press, 2012.Google Scholar
Barnes, L. Diane. “Industry and Its Laborers, Free and Slave in Late-Antebellum Virginia.” In The Old South’s Modern Worlds: Slavery, Region, and Nation in the Age of Progress, edited by Barnes, L. Diane, Schoen, Brian, and Towers, Frank, 189–206. Oxford: Oxford University Press, 2011.Google Scholar
Dorfman, Joseph. “A Note on the Interpenetration of Anglo-American Finance, 1837–1841.” Journal of Economic History 11, no. 2 (Spring 1851): 144–145.Google Scholar
Forret, Jeff. “‘How Deeply They Weed into the Pockets’: Slave Traders, Bank Speculators, and the Anatomy of a Chesapeake Wildcat, 1840–1843.” Journal of the Early Republic 39, no. 4 (Winter 2019): 709–736.CrossRefGoogle Scholar
“John Taylor and his Descendants.” South Carolina Historical and Genealogical Magazine 8, no. 2 (April 1907): 95–119.Google Scholar
Kaye, Anthony E. “The Second Slavery: Modernity in the Nineteenth-Century South and the Atlantic World.” Journal of Southern History 75, no. 3 (2009): 627–650.Google Scholar
Kotlikoff, Laurence J. “Quantitative Description of the New Orleans Slave Market, 1804 to 1862.” In Without Consent or Contract: Technical Papers on Slavery, vol. 1, edited by Fogel, Robert W. and Engerman, Stanley L., 31–53. New York: W. W. Norton, 1992.Google Scholar
Lander, Ernest M. Jr. “The Iron Industry in Ante-Bellum South Carolina.” The Journal of Southern History 20, no. 3 (August 1954): 337–355.CrossRefGoogle Scholar
Martin, Bonnie. “Slavery’s Invisible Engine: Mortgaging Human Property.” The Journal of Southern History 76, no. 4 (November 2010): 817–866.Google Scholar
Mihm, Stephen. “Follow the Money: The Return of Finance in the Early American Republic.” Journal of the Early Republic 36, no. 4 (Winter 2016): 783–804.CrossRefGoogle Scholar
Murphy, Sharon Ann. “Collateral Damage: The Impact of Foreclosure on Enslaved People during the Panic.” Journal of the Early Republic 40, no. 4 (Winter 2020): 691–696.CrossRefGoogle Scholar
Murphy, Sharon Ann. “The Financialization of Enslavement by the First and Second Banks of the United States.” Journal of Southern History (forthcoming September 2021).CrossRefGoogle Scholar
Murphy, Sharon Ann. “Securing Human Property: Slavery, Life Insurance, and Industrialization in the Upper South.” Journal of the Early Republic 25, no. 4 (Winter 2005): 615–652.CrossRefGoogle Scholar
Ng, Kenneth. “Free Banking Laws and Barriers to Entry in Banking, 1838–1860.” Journal of Economic History 48, no. 4 (December 1988): 877–889.CrossRefGoogle Scholar
Olmstead, Alan, and Rhode, Paul. “Biological Innovation and Productivity in the Antebellum Cotton Economy.” Journal of Economic History 68, no. 4 (December 2008): 1123–1171.CrossRefGoogle Scholar
Rothman, Joshua D. “The Contours of Cotton Capitalism: Speculation, Slavery and Economic Panic in Mississippi, 1832–1841.” In Slavery’s Capitalism: A New History of American Economic Development, edited by Beckert, Sven and Rockman, Seth, 122–145. Philadelphia: University of Pennsylvania Press, 2016.CrossRefGoogle Scholar
Vollmers, Gloria. “Industrial Slavery in the United States: The North Carolina Turpentine Industry, 1849–61.” Accounting, Business & Financial History 13, no. 3 (November 2003): 369–392.Google Scholar
Watson, Alan D. “North Carolina and Internal Improvements, 1783–1861: The Case of Inland Navigation.” North Carolina Historical Review 74, no. 1 (January 1997): 52–57.Google Scholar
Wright, Robert E., and Kingston, Christopher. “Corporate Insurers in Antebellum America.” The Business History Review 86, no. 3 (Autumn 2012): 452–453.CrossRefGoogle Scholar
Charleston Courier Google Scholar
Charleston Daily Courier Google Scholar
Charleston Mercury Google Scholar
Cheraw Advertiser Google Scholar
Edgefield Advertiser Google Scholar
North Carolina Standard Google Scholar
Franklin H. Elmore Papers, Library of Congress (Elmore Papers)Google Scholar
Franklin Harper Elmore Papers, 1833–1936, Southern Historical Collection, University of North Carolina at Chapel Hill (Elmore Papers UNC)Google Scholar