Over the River and Through the Woods

Frontier Economy, Transportation, and the Prospects of Madison, Indiana

John L. Larson, History

I. What Came Naturally

II. The Urge to Improve

III. The Market Revolution

I. What Came Naturally

A. Original landscapes

B. Primitive export and import

A. Original landscapesBy 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 centeredon 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

Steamboats: cheap, private, flexible, effective

Madison waterfront in 1846

Roads -Macadam -regular -stumps

Canals -Erie 1825 -Ohio >1827 -Indiana >1836

Still 3 miles per hour

Railroads: experimental until 1850

B&O Lafayette 1837

M&I’s #1

M&I’s Reuben Wells 1868

Mohawk & Hudson

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 diversificationB. Cash overcomes barter/exchangeC. Rise and fall of local advantagesD. Market forces take commandE. 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?

Granger print 1870s

Bryan campaign 1896