Norwich bulletin., 1918-12-07
1865 AND 1918 SOME

A comparison of the present bases l for the readjustment of industry with 1 the foundations of the notable busi- ness expansion in this country follow ing the Civil war warrants the ex- pectation that the development of va rious frontier regions, for which new preparations have been made, will parallel in it's effects upon world in- i dustry the~stimulus of the developing west in the earlier period, says the De- cenber Guaranty News
 The effects of war upon a nation are conditioned largely by the stages in the industrial cycle through which the nation happens to be passing. The Civil war followed several years of upward moving prices and volume of production.
 The most significant index of the business expansion in this country in the decade preceding the war is the unprecedented development of trans portation. The orgy of canal building, so much of which was unwisely di- rected had received a decided check from the panic of 1S37 Railroads had passed through a period of experi- mentation during which they were projected primarily as feeders for water routes. By 1850 it was increas- ingly evident that they were to occupy the dominant position in inland trans
 port. Previous to that year only 5000 miles of railway had been constructed in this country but in the following decade 21,000 miles were added While most of the new mileage was in the
 older sections, east andi south, some lines were pushing westward. Rails l reached Chicago in 1853, St. Louis in l 1855, and the Missouri river in the 1 northwest three years later.
 [ fTnf s,- l 1S4S, almost coincident with the Aus 1 tralian finds of the precious metal, further stimulated industrial enter prise, through the operation of an i increasing gold money supply in rais- l ing the general level of prices, and materially hastened the westward
 movement of population and industry 1 In short, the industrial background l of the pre-war period was essentially sound-a great e8ranse of territory 1 rich in natural resources and respond ing in development to the rapid ex- | tension Of railroads; a population more than doubling in $ generation; anf farm products, manufactures and ex- ports each doubling practically in 2 decade-with resulting prosperity
 which the reaction of 1857 did not ma terially, or fer long. disturb.
 Apparently the situation at the clost
 of the war might have foreshadowet a period of serious industrial depres
 sion. Hundreds of thousands of sol.
 die~s had to be reabsorbed by indus
 try; the economic and social systen
 of the southern half of the repuhli,
 was disrupted, with most of it's peopl,
 literally in poverty: the nation
 money was for the most part mas! of appreciated irredeemable notes
 prices were ahnormaily high but rap
 idly falling: and there was a publi
 debt of more than two and half bil
 lioE dollars.
 Instead of industrial presentation , however there followed a remarkabl, prompt restoration of apparently nor nal prosperity. The explanation i , found in the pre-war foundations; fo
 the expansion which came as a seque to the war was along the lines rrevi
 ously proiected-e&pansion which wa the natural outgrcwth of the spread c
 transportation agencies.
 The gross volume of the country business multiplied three-fold in tn , twenty-year period 1S60-1SS0, a : measured by an index number whic combines the following items: Goa 1 iron, cotton. wool ,and wheat produc ] tion; railway mileage in operation r :mmigration; exports and imports ( l merchandise; New York bank clear Q ings; and the reciprocal of commerce. Q failures. Where necessary, the dat d. are corrected to eliminate the infiu i ence of price changes. The inde, o therefore. is measurement of quar q titles.
 S The occupied territory and the DOT . hlation wEre increasing so rapidl. S however, that more trustworthy il e dex is obtained by reducing the gros n volume of business to a per capii
 basis. Thus corrected, the 1nde a shows a virtual doubling of the couT I try's per capita business. This e! = pansion was not a disproportiona !, growth in the yield of farm product = or in the production of raw mater;a O in general. The figures for the outpl ? of manufactures, corrected for popl [ lation and price changes-but not il Id cluded in the barometer because da a for other than census years are lacl IT ing-show an even greater increa ,e than does the index,
 lt The sharp decline in business whit "a came With the first shock of war VI 2 matched by prompt recovery to | sT previous level. Taking the figures f ,t production. etc., in 1860 as the bas al or 100, the index figure for 1881 Ie S4, and for the next year 102. Ther ,- after, with the exception of slig d recession in 1869, there was an uni III terrupted gain until under the stra Q. the credit machinery collapsed in t IF crisis of 1873, precipitating a period ,a depression. After three years the T ;6 covery began and was so rapid tn
 by 1880 the volume Of business r . capita was smaller by only 14 2 +a cent. than it would have been had | .o trend from 1885 to 1872 been mai e tained without interruption.
 rh The decline in the highly infiat he war prices which began early in 1S