April 1861, cotton bubble impacts Levuka and UK Lancashire President Lincoln ordered a blockade of the Confederate southern ports, the outlet for the raw cotton on which Lancashire’s mills depended.

The American Civil War was a crucial event in the history of the both Levuka and the UK Lancashire cotton industry. The blockade cut supply of low cost African slave-made southern-USA cotton to the mills of the UK, Cotton price rose and entrepreneurs flooded to Fiji with plan to grow cotton with Pacific slave labour. But the boom crashed in 1870, as the price when cotton-volumes, rose again.

Levuka and the American civil war: In April 1861, President Lincoln ordered a blockade of the Confederate southern ports, the outlet for the raw cotton on which Lancashire’s mills depended. Attempts to find alternative sources of supply from India or Egypt had little success. The short stapled Surat cotton proved no substitute for the medium stapled American variety. Deprived of essential raw material, spinning mills and weaving sheds closed down or resorted to short time working. Unemployment mounted rapidly. The blockade of the southern ports of the USA by the US Federal navy cut off the supply of raw cotton on which Lancashire’s mills depended. Mill closure, short time working and mass unemployment resulted. The crisis reached its peak in 1862/3.

Excessive production and speculation in the late 1850s: Recent histories changed the interpretation of events. Industrial depression would have resulted despite the Civil War due to excessive production and speculation in the late 1850’s. Stocks of raw cotton remained in Lancashire throughout the period but were held in warehouses by merchants gambling on a further rise in prices. Lancashire was not wholly sympathetic to the cause of the Northern states, even demanding British government action to break the blockade. Cotton operatives did not suffer in silence to free the Southern plantation slave.

The Lancashire Cotton Famine, 1861 -1865: In the early 1860’s, the Lancashire cotton industry, which dominated the mid-19th century British economy, was devastated by a political event beyond its control, the Civil War in the United States of America. By November 1862, three fifths of the labour force, 331,000 men and women were idle. Many operatives, their savings exhausted, were forced to apply for charitable handouts or for relief from the despised poor law system. Such hardships, however, they endured calmly because they believed in the noble cause for which Lincoln was fighting, the freeing of the slaves of the southern plantation owners. From its peak in 1862/3, unemployment fell, but not until the end of the war, in April 1865, was normal working resumed. The cotton industry never regained the dominance it had once held in the British economy.

Bust was due anyhow: Simple historical narratives, however inspiring, often conceal a more complex reality. Economic historians like W. O. Henderson, Eugene Brady and Douglas Farnie, have shown, what a contemporary economist, W. T. M. Torrens hinted, that, with or without the American Civil War, the Lancashire cotton industry would have suffered a depression in the early 1860’s due to massive over production and speculation in the late 1850’s.

Speculators played the market: There were considerable stocks of raw cotton in Lancashire during the Civil War, but these were held in warehouses by merchants waiting for a further rise in prices or exporting to overseas markets like New York where a more favourable price could be obtained. Nor was liberal, free trade Lancashire wholly supportive of the Federal cause. As Mary Ellison pointed out, Lancashire men suspected the centralising ambitions of Lincoln which would diminish the political freedom of the southern states of America.

The Cotton Famine was an important episode in the history of the Lancashire cotton industry. That two histories of it, those by R. A. Arnold and by John Watts, were written before it was over, indicates an anxious desire to justify conduct during it.“The Cotton Famine is an event that has burnt itself into the history of Lancashire.” (London Quarterly Review. January 1865). Michael Rose

Further reading:

R. A. Arnold, The History of the Cotton Famine (London, 1864)

John Watts, The Facts of the Cotton Famine, (London, 1866)

W. O. Henderson, The Facts of the Cotton Famine, 1861 – 1865 (Manchester, 1934)

D. A. Farnie, “The Cotton Famine in Great Britain” in B. M. Ratcliffe, editor, Great Britain and Her World, 1750 -1914: Essays in honour of W. O. Henderson. (Manchester, 1975)

E. A. Brady, “A reconsideration of the Lancashire Cotton Famine” Agricultural History, July 1963, pp. 156 – 162

Mary Ellison, Support for Secession (London, 1972)

Michael Rose, “Rochdale Man and the Stalybridge Riot: the Relief and Control of the Unemployed during the Lancashire Cotton Famine” in A. P. Donajgrodzki, editor, Social Control in Nineteenth Century Britain. (London, 1977)

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