VIRGINIA

Virginia, home of presidents and cradle of American tradition, has a special place in the consciousness of the nation. Its economic history is perhaps less well-known than its political history. Supported, at first, by slave-owning plantations, the state depended for many years on tobacco and cotton crops. After the devastation brought about by the American Civil War (1861–1865), Virginia rebuilt its economy, adding industry to its agricultural base. Modern Virginia contains a healthy mix of farming, industrial, and service employment.

Virginia has claim to being the first permanent English settlement in America. The colonists who established Jamestown in 1607 named their colony Virginia in honor of the "Virgin Queen," Elizabeth I. The London Company, a joint-stock venture sponsored by King James I, claimed nearly all of the eastern coast of America, a great deal more land than now encompasses Virginia. Many in this expedition were gentlemen who had no clear idea of how to survive in the wilderness. Captain John Smith finally took matters into his own hands, declaring, "He that will not work neither shall he eat." As journalist Alistair Cooke wrote in his book, Alistair Cooke's America, this statement was "rooted . . . early and deep in the American consciousness." The colony weathered times of starvation, attacks by Indians, and the deaths of many people, but it somehow survived and even established its own form of representative government. After James I revoked the London Company's charter in 1624, Virginia became a royal colony.

The colony continued to grow along the James, York, Rappahannock, and Potomac rivers. It depended largely on the growing of tobacco (and later of cotton) with the help of indentured servants, both white and black. It is thought that the institution of slavery developed from the first black servants sent to Virginia. As eastern Virginians moved into the western part of the country, they began to lose much of their loyalty toward England, especially during the French and Indian War. The Virginia House of Burgesses engaged in repeated protests against British policy, which culminated in a boycott of British goods in response to the Townshend Acts. Virginia was the first colony to begin the move for independence from England in 1776 and it was a major player in the American Revolution (1775–1783). Virginia was so influential in this period that Virginians occupied the U.S. presidency for all but four of the nation's first 28 years.

In the early nineteenth century Virginia's influence began to decline. The eastern half of the state disputed constantly with the western half (later, the state of West Virginia), as eastern aristocrats held most of the political and economic power. Life all over the state remained largely rural and self-sufficient while roads were poor and mail delivery slow. Cities which did grow in the state, like Richmond and Norfolk, grew less rapidly than cities in other parts of the country.

By the mid-nineteenth century Virginia was entering another period of prosperity. The Valley Turnpike, completed in 1840, made transportation through the Shenandoah Valley easier. Agricultural experimentalists like Edmund Ruffin used new scientific methods to revitalize agricultural land worn out by years of tobacco farming. Land values rose with crop diversification, livestock production, and the use of new machinery. Industrial development was beginning too, as railroads began to form in a network across the state.

Closely tied to the economy of Virginia, especially on the eastern plantations, was the issue of slavery. In the 1830s the state was a major purveyor of the slave trade. Thus the growing antislavery movements of the 1850s were quite threatening to many Virginians. John Brown's raid on Harper's Ferry (then in Virginia) was a wake-up call to the state, which in the end reluctantly seceded from the Union in 1861.

As the main battlefront during the American Civil War (1861–1865), much of Virginia's countryside, as well as the city of Richmond, was left in ruins when the hostilities ended. The state also lost about half its territory when West Virginia seceded in 1863 to side with the North. A postwar debt of more than $45 million and corrupt Reconstruction leadership left Virginia in turmoil. After Reconstruction wealthy planters lost some of their political power. According to Louis D. Rubin, Jr., "Landed wealth, which had previously constituted a sufficient economic foundation for most Virginians, no longer sufficed." New leaders were rather "men who saw opportunity for themselves and their community in business, industrial development, railroading, [and] finance. . . ." This period was marked by significant expansion of railroads in the state, the most powerful being the Pennsylvania Central.

The state expanded greatly during this time, as suburbs of cities like Norfolk and Richmond developed and other towns like Hampton Roads and Roanoke grew rapidly due to their access to coal routes. Real estate boomed and manufacturing and mining companies sprang up. In 1893, however, a nationwide financial panic gripped the state. Small farmers in particular were devastated, with cash and credit in short supply. Blacks in the state were even worse off, lacking education and living with the legacy of slavery. In 1901 a state constitutional convention moved to eliminate black voting privileges, which had been in force since Reconstruction, thus reinforcing the continued segregation of society.

Conservative Democrats seemed destined to control the state after the turn of the century. In 1925, however, Harry Byrd, a liberal Democrat, won the governorship and embarked on an era of reform. During his tenure the state tax system was revised, along with a number of social reforms, and measures were taken to attract industry to the state.

After the Great Depression (1929–1939), Virginia entered a new era of prosperity, benefiting from defense contracts, manufacturing, and a growing tourist industry. Notable among the state's tourist attractions were the newly restored colonial capital city of Williamsburg and historic sites such as Jamestown, Monticello, and Civil War battlefields. Franklin D. Roosevelt's (1933–1945) New Deal, supported by Harry Byrd, was also responsible for the creation of Blue Ridge Parkway, part of the Shenandoah National Forest.

In the 1960s Virginia began to put its financial affairs in better order by enacting a sales tax and a multi-million-dollar bond issue which benefited the public school system. In the early 1980s the Virginia Beach/Norfolk area grew rapidly, largely as a result of federal jobs and new military spending. Between 1980 and 1990 the population of Virginia Beach grew by 50 percent. As non-agricultural employment increased, however, the economy of rural areas did not improve.

Virginia's economy experienced a recession in the late 1980s. Democratic governor Douglas Wilder responded by cutting state services and reducing budgets, thus creating significant hardships for education and less affluent counties. By the mid-1990s, however, Virginia's economy had rebounded, largely because of its diversified economy that included agriculture, manufacturing, as well as service industries—the latter mostly in federal government employment. In the late 1990s the port of Hampton Roads was one of the busiest in the country, with the largest amount of tonnage on the East Coast. In 1996 Virginia ranked fourteenth among the states in per capita income, at just under $25,000, and its unemployment rate in 1997 was just 4.5 percent, below the national average. The percentage of labor union membership in the state was only 6.8 percent of all workers. The state maintained a pro-business climate, which was aided by the state's conservative history, low wages, low tax rates, and weak labor movement. The Virginia Economic Development Corporation gave low-interest loans and other incentives to businesses, as did the Virginia Small Business Financing Authority.

VIRGINIA

FURTHER READING