Slavery and The History Of Money.

The Foundations of Modern Finance: How Slavery Built the Global Economy

Introduction

The history of money and finance is deeply intertwined with the institution of slavery. From the early days of colonial expansion to the Industrial Revolution, enslaved labor was not merely a source of human suffering but a cornerstone of economic systems that shaped modern capitalism. This essay explores how slavery fueled the accumulation of wealth, the rise of banking and insurance industries, and the development of global trade networks. By examining the transatlantic slave trade, plantation economies, and the financial innovations tied to human bondage, we uncover how the modern concept of “money” was built on the exploitation of enslaved people.

I. The Origins of Money and Slavery

Long before the transatlantic slave trade, slavery was a tool for economic growth. Ancient civilizations like Rome and Greece relied on enslaved labor to build infrastructure, farmlands, and artisanal industries. Enslaved people were treated as both labor and currency—a commodity to be traded, taxed, or used as collateral. However, the scale and systemic nature of slavery changed dramatically during the European colonial era.

The rise of sugar, tobacco, and cotton plantations in the Americas created a demand for labor that European indentured servants and Indigenous populations could not meet. This demand was filled by the transatlantic slave trade, which saw 12–15 million Africans forcibly transported to the Americas between the 16th and 19th centuries. Enslaved people became the engine of a lucrative economic machine, generating raw materials that were processed, traded, and monetized across continents.

II. The Transatlantic Slave Trade: Capitalism’s Bloody Backbone

The triangular trade—Europe, Africa, and the Americas—was the first truly globalized economic system. European ships carried manufactured goods to Africa, traded them for enslaved people, transported those people to the Americas, and returned to Europe with colonial commodities like sugar and cotton. Each leg of the journey generated profit, but the most valuable “cargo” was human beings.

A. Enslaved Labor as Capital

Enslaved Africans were not just workers; they were capital assets. Plantation owners calculated their wealth based on the number of enslaved people they “owned.” For example, in 1860, the collective value of enslaved people in the U.S. South was $3.5 billion—more than the total value of railroads and factories nationwide. This commodification allowed enslavers to mortgage enslaved people, use them as loan collateral, or sell them to settle debts.

B. Financial Innovations

The slave trade spurred financial creativity:

• Insurance: Ships and enslaved people were insured against risks like rebellion or death. Lloyd’s of London, now a global insurance giant, began by underwriting slave voyages.
• Bonds: Plantation mortgages were bundled into securities traded on European stock exchanges.
• Banking: Banks like Barclays and J.P. Morgan’s predecessor institutions financed plantations and slave voyages.

III. Slavery and the Industrial Revolution

The wealth extracted from enslaved labor directly funded Europe’s Industrial Revolution. Cotton, the “white gold” of the American South, became the world’s most traded commodity. By 1860, the U.S. supplied 75% of Britain’s cotton, which was spun into textiles in factories like Manchester’s. These textiles were then sold globally, including back to Africa to purchase more enslaved people.

A. Technological Advancements

Profits from slavery funded innovations such as steam engines and railroads. James Watt’s steam engine was first used in Caribbean sugar mills, while railways in Britain were built to transport slave-grown cotton.

B. Urban Growth

Port cities like Liverpool, Bristol, and Nantes grew rich from the slave trade. Their docks, banks, and merchant houses were monuments to human suffering.

IV. Slavery and the Birth of American Capitalism

In the United States, slavery was central to national economic growth. The U.S. Constitution protected slavery through clauses like the Three-Fifths Compromise and the Fugitive Slave Act. Northern industries profited too:

• New York banks financed Southern plantations.
• New England mills processed slave-grown cotton.
• Northern ships transported enslaved people domestically.

The domestic slave trade, which displaced over 1 million enslaved people from the Upper South to the Deep South between 1790 and 1860, created a speculative market akin to real estate. Enslavers like Solomon Northup’s captors became millionaires by trafficking humans.

V. Abolition and the Illusion of Economic Progress

After slavery was abolished in the 19th century, its economic legacy persisted. Former enslavers received compensation for their “losses” (e.g., Britain’s 1833 Slavery Abolition Act paid out £20 million, equivalent to £300 billion today), while freed people received nothing.

A. Sharecropping and Debt Peonage

In the U.S. South, sharecropping trapped Black families in cycles of debt, while convict leasing re-enslaved thousands through punitive labor systems.

B. Global Exploitation

European powers shifted to colonial exploitation in Africa and Asia, extracting resources through coerced labor—a practice that mirrored slavery.

VI. Modern Legacies: From Wealth Gaps to Reparations

The racial wealth gap in nations like the U.S. and Brazil is a direct result of slavery. Black families were excluded from wealth-building opportunities like land ownership (e.g., broken promises of “40 acres and a mule”) and redlined from housing loans.

A. Corporate Accountability

Companies like Lehman Brothers, Aetna, and Tiffany & Co. have acknowledged ties to slavery. Universities, including Harvard and Georgetown, profited from enslaved labor.

B. Reparations Movements

Calls for reparations—financial compensation for descendants of enslaved people—are growing. In 2023, California established a task force to study reparations, while institutions like the Church of England have pledged funds.

Conclusion

Money, as we understand it today, was built on slavery. The financial systems that govern our world—banks, insurance, stock markets—were shaped by the commodification of human lives. Acknowledging this history is not just about moral reckoning; it is about understanding how systemic inequality was engineered and how it persists. Reparations, education, and inclusive economic policies are essential steps toward dismantling slavery’s enduring legacy. As historian Eric Williams wrote, “Slavery was not born of racism; racism was the consequence of slavery.” The path to justice begins with confronting this truth.