[pjc50]

Modern America was built on inter alia the acquisition of huge areas of land for nothing, the business practices of companies like Standard Oil, and the exploitation of immigrant workers in conditions only slighly above slavery.

> wealth of Britain in 1900

Similarly this was at peak Empire time period, when a vast British Army was marching across South Africa herding colonists into concentration camps. What part of the wealth of the Empire was really freely acquired in a mutually beneficial way?

[barry-cotter]

America was indeed unusual among first world nations in the relative positions of labour and capital, but not much out of the ordinary in its growth rates. There were many other New World nations with similarly devastated native populations and land for the taking. The US has grown faster than any comparable country, not because of the abundance of natural resources but because of its political, legal and economic systems. Canada, Argentina and Chile all had similar benefits and none are as rich.

I’m going to pass on the labour practices of Standard Oil just because living standards in the US were on an unbroken upward trend during the entire period between its establishment and break up. This, combined with the US tradition of labour unrest make the idea that working conditions were slightly above slavery ridiculous. In a tight labour market you can’t treat free labour like slaves. They’ll leave. People who are willing to cross an ocean are not going to hesitate to move states for work, especially in an era of unprecedentedly cheap transport due to the railways. This is a myth, like the myth that the trusts gained their market shares corruptly. They gained it by increasing production and quality and driving down prices.

> University of Chicago economics professor Lester Telser, in his 1987 book, A Theory of Efficient Cooperation and Competition,4 points out that between 1880 and 1890, the output of petroleum products rose 393 percent, while the price fell 61 percent. Telser writes: “The oil trust did not charge high prices because it had 90 percent of the market. It got 90 percent of the refined oil market by charging low prices.” Some monopoly!

https://www.econlib.org/library/Columns/y2013/Hendersonbaron...

Lester Telser, A Theory of Efficient Cooperation and Competition. New York: Cambridge University Press, 1987.

Regarding Britain power was partially built on its colonies but its prosperity was not. If it had been we should be able to see it clearly in the growth rate of its economy after the conquest of Bengal or after the loss of India. Invisible in both cases. Economic progress in Western Europe was built on trade and industry, not plunder. If it hadn’t been the U.K. would have been vastly richer than Sweden and France richer than Germany. Despite the enormous disparity in colonial holdings they were roughly as rich. Colonies were everywhere a boon to the scions of the ruling classes, providing military and civil service posts but the economic impacts were nugatory. British wealth was as much a product of its empire as Italy’s, somewhere between trivial and non-existent.

[dajohnson89]

The advancements of industry were accelerated by a limitless supply of cheap slave labor. And of course, the natural resources that were plundered from the colonies.

[barry-cotter]

Slave labour was never cheap. Buying slaves was always very expensive because being able to keep the fruits of someone else’s labour was always a great way to make money. And natural resources are nice to have but if you don’t have them but you have money (perhaps gotten from productive industry) you can just buy them. Singapore and Hong Kong went from poverty to the first world in a generation based on good institutions and sound economic policy. And again colonies were never a big deal for the metropole economically. The Nordic countries didn’t have any colonies of note and they did just fine economically over the 19th and 20th centuries. The Austro-Hungarian Empire was doing worse economically than the German in 1912, but not much, and it wasn’t because of the lack of colonies. The Netherlands’ economy basically didn’t notice the loss of Indonesia, ditto Belgium for the Congo. Natural resources just aren’t that important. Equatorial Guinea is swimming in oil and its people are poor as dirt because their government because it’s governed by a kleptocrat. South Korea was a bombed out hellscape in 1954 and now it’s a first world country. That’s not because of natural resources, it’s because of export led growth, same as Japan, Taiwan, Singapore and Hong Kong. None of them are particularly blessed with oil or minerals. Switzerland’s natural resources are hydropower and beautiful scenery. The beautiful scenery is a bigger deal economically. Saudi Arabia is sitting on the biggest oil fields in the world and once people stop caring about oil the country will go to hell. Norway is also sitting on loads of oil and will be just fine because their economy isn’t all natural resources.

Natural resources just aren’t that important.