Yet the Confederates were proven wrong, not only by the North’s willingness to fight and its subsequent victory, but also by the aftermath of that victory, in which an American economy without slavery entered a period of unprecedented growth and development.

This divergence between North and South was of course a major factor in the buildup to the Civil War, a war that sometimes seems to lose any material basis for the historians on which Desmond relies. Ironically these historians appear to be reviving the Confederate view of American economic history. Desmond approvingly quotes a Southern slave-owner who argued that slavery was “the nursing mother of the prosperity of the North.” This argument was an encouragement to secessionists, who imagined that the North would do everything to avoid a war that would cripple the Northern economy by cutting it off from a major source of its wealth.

Slave-owners also discouraged migration to the South, which they feared would lower the price of slaves and dilute their power locally, such that the region lagged behind in population as well as in urban and industrial development. Thus Wright concluded that slavery most likely reduced the expansion of America’s cotton supply (and thus raised the price of cotton). But whatever we make of the counterfactual assumptions underlying this claim, it cannot be denied that the size of the Southern economy as a share of the national economy fell from 1800 to 1860. Simply put: despite all the evidence of its economic dynamism, the slave South was falling behind the free North.

Finally, both Desmond and many of the historians on whom he relies neglect other ways that slavery imposed constraints on economic growth and development. The renowned historian of slavery Gavin Wright recently delivered the Tawney lecture to the Economic History Society on these constraints. He pointed out that Southern slave-owners opposed almost every policy of state and federal economic development, including investments in education and agricultural improvement.

Desmond also draws on the work of Edward Baptist and Caitlin Rosenthal to suggest that the Southern slave-based economy was a hotbed of dynamic innovation in finance and accounting. It is true that the Southwest was a center of credit expansion in the 1830s (though this was driven by an increased demand for cotton, not by speculation in slaves). It is also true, as Rosenthal demonstrates, that large planters often adopted the latest methods of accountancy, partly in the service of labor management. But there is little evidence that slave-owners themselves invented new financial instruments or new methods of accountancy, or that the adaptation of these things to the plantation led them to be widely adopted elsewhere in the American economy. Rosenthal is careful to note that her book “is not an origin story,” but that is how Desmond reads it.

Historians like Beckert and Seth Rockman get around this fact by pointing to forward and backward linkages that connected slave-produced cotton to Northern industries. But this claim (known as “the cotton staple hypothesis”) has also been widely rejected by economic historians. Slave plantations provided raw cotton to Northern mills and offered some markets to Northern producers, but Southern demand was limited by the production of food and other inputs on plantations themselves (Desmond approvingly cites Walter Johnson’s claims that the South was a net importer of food, but it was not). It’s true that slavery made many fortunes, in both cotton and sugar, such that there were more millionaires per capita in the Mississippi Valley than anywhere else in the country. But it’s also true that most of that wealth stayed in the South, where it was tied up in land and slaves, such that the net effect on real accumulation was probably negative.

It’s true that cotton was among the world’s most widely traded commodities, and that it was America’s principal antebellum export. But it’s also true that exports constituted a small share of American GDP (typically less than 10 percent) and that the total value of cotton was therefore small by comparison with the overall American economy (less than 5 percent, lower than the value of corn).

Desmond begins his article by drawing on the Harvard historian Sven Beckert who argues that “it was on the back of cotton, and thus on the backs of slaves, that the U.S. economy ascended in the world.” Yet Desmond neglects to mention that this claim has been widely rejected by specialists in the economic history of slavery.

The article provoked predictable wails of disapproval among conservatives seeking to defend the moral integrity of capitalism, and the Times should be commended for exposing its readers to the brutal history of slavery, which is indeed central to the story of American capitalism. But the vision that Desmond presents is wrong on the details, and obscures the way in which slavery actually shaped the wealth and power of American capitalists.

In a New York Times Magazine article this month, Matthew Desmond provided an overview of recent work by historians of capitalism who argue that slavery was foundational to American growth and economic development in the nineteenth century. In Desmond’s words, slavery “helped turn a poor fledgling nation into a financial colossus.”

Why Slavery Mattered

However, the fact that the American economy appears to have prospered from the abolition of slavery should not lead us to conclude that slavery had no lasting consequences for US economic development. Desmond himself seems aware of the limitations of the “slavery drove growth” story, for he subtly redirects the arguments of the historians he cites away from their focus on slavery’s original contribution to American wealth, and towards its contribution to what he calls America’s culture of “low-road capitalism.”

This concept is borrowed from the sociologist Joel Rogers, for whom it refers to a deregulated, deskilled, low-wage economy, with low levels of union density and social protections. I suspect Rogers would object to Desmond’s cultural interpretation of the “low-road” (as well as his contrast with “emancipatory capitalism”) but I think Desmond is right to suggest that the stakes of the question of slavery’s contribution to American capitalism are not merely historical, but also contemporary, and that our answer to that question may also help us answer another one: “why is there no social democracy in the United States?”

The problem is that the causal channels identified by Desmond don’t really explain the low road on which American capitalism undoubtedly runs. What do the monetary flows between the antebellum North and South, or the technologies developed on slave plantations, have to do with America’s low levels of social protection today? In the end Desmond’s argument comes down to the diffusion and persistence of what he calls (quoting Joshua Rothman) a “culture of speculation unique in its abandon.”

Leaving aside the question of how unique that culture actually was (the 1929 and 2007 financial crises that Desmond attributes to it were after all global crises), it remains a mystery how this culture persisted so long after the abolition of the institution which supposedly gave rise to it. Desmond’s language reflects the murky, even ghostly, character of that persistence: he points to “eerie” analogies between past and present; slavery is described in religious terms as a “national sin” that is “visited upon” later generations; and of course we get that most modern, and most American, of all metaphors for mysterious lineage: “slavery is necessarily imprinted on the DNA of American capitalism.”

But in truth there need be no mystery. For there are straightforward ways that slavery clearly influenced the development of American capitalism — ways that don’t require us to pad the numbers or believe in ghosts. The first and most obvious one is the legacy of anti-black racism that is powerfully described in other contributors to the 1619 Project. That legacy undoubtedly divided the American labor movement, weakened progressive political alliances, and undermined the provision of public goods (see for instance the excellent pieces by Kevin Kruse and Jeneen Interlandi in the same issue of the New York Times Magazine).

There is also a lesser-known but equally clear and durable influence of slavery evidenced in the work of legal and institutional historians that Desmond neglects, such as David Waldstreicher and Robin Einhorn. These historians point out that a major effect of slavery on US economic development came through its foundational influence on America’s legal and political institutions.

One of the central problems faced by delegates to the Constitutional Convention in 1787 was how to create a common legal and political framework that would unite the slave states of the South with Northern states that were then in the process of abolishing slavery. The slave states were concerned that a strong federal government dominated by Northerners might tax their slaves or even abolish slavery.

The solution the delegates found was two-fold. On the one hand they ensured that the South was disproportionately represented at the federal level through the three-fifths clause. On the other hand, they reserved the bulk of fiscal and economic policymaking to the states themselves. Thus the constitution effectively restricted federal taxing and regulatory power to international and interstate commerce.

But even here slavery shaped the way that power would be used. Slave states were concerned about federal power to tax slave imports and slave-produced exports, but they also wanted the federal government to enforce their property claims when it came to fugitive slaves who might flee to the free states. The result was a restriction on the federal government’s taxing power (banning export taxes and limiting taxes on slave imports) and a strengthening of its power (vis a vis the states) to enforce property claims in the “fugitive slave clause.”

This division of federal and state power over slave property is not just manifest in now-dormant articles of the constitution dealing with slavery. It imbues all parts of the constitution and arguably lent to the American state system its distinctive form, which combines strong property protections with weak regulatory and fiscal powers (the introduction of a federal income tax in 1913 required a constitutional amendment).

Apologists for this system call it “competitive federalism.” The fugitive slave act and the commerce clause restricted the domestic power of the federal government — the most powerful entity in the state system — to protecting large merchants and enforcing property claims across state lines, i.e., ensuring the mobility of capital. Its powers to tax, spend, and interfere with the interests of the wealthy (e.g., through regulating banks or providing debt relief) were explicitly curtailed. Even the legal scholar Richard Epstein, a libertarian champion of competitive federalism, acknowledges that “it’s quite clear that the cause of limited government was advanced by the institution of slavery.”

In principle the states were left to regulate and tax as they liked, but their practical ability to do so was constrained by federally mandated capital mobility. This created a fiscal and regulatory race to the bottom, as the wealthy could force relatively weak state legislatures to compete for their investments — just as city and state governments prostrate themselves before Amazon and Boeing today. The infamous Dred Scott case was itself a matter of the federal judiciary protecting capital mobility (in that case the right of slave-owners to move through the territories with their slaves) and Robin Einhorn points out that the same principle was at work in later judicial interpretations of the Fourteenth Amendment that allowed federal courts to strike down state-level labor regulations.

Einhorn’s point is not that the framers were all proslavery (they were not) nor that they intended to produce a capitalist paradise of unfettered accumulation. Her point is that in making certain concessions to the slave-owners the framers unintentionally generated those conditions. Slave-owners were particularly afraid of allowing democratic control over property because they were literally afraid of their property. They were haunted by the threat of slave insurrections, as well as foreign armies turning their slaves into enemy soldiers through offers of freedom (as the British had recently done). Einhorn concludes that “if property rights have enjoyed unusual sanctity in the United States, it may be because this nation was founded in a political situation in which the owners of one very significant form of property thought their holdings were insecure.”

The resulting balance of strong property protections and weak regulatory and taxing power may or may not have been conducive to economic growth (that’s for economic historians to figure out). But there is no doubt that it helped shift American capitalism onto the low road. In addition to the profound effect of slavery on America’s enduring racial inequality, slavery’s legacy for American capitalism may thus be found more in the structural constraints on US politics than in its direct contributions to the nineteenth-century American economy.