Colonial Virginia was what a sociologist would call a narco-state, which is what Colombia and Laos and Afghanistan each were for a while. Colonial Virginia also resembled those urban communities in the United States that are beleaguered by drugs and drug gangs. That is the conclusion that can be drawn from Edmund S. Morgan's very powerful and detailed history, American Slavery, American Freedom: The Ordeal of Colonial Virginia, which won the Pulitzer Prize for history in 1970. Morgan used the demographic and legal records of early Virginia to draw his vivid picture of women outliving their fast dying men so that a prize in the marriage market was a widow bringing with her the fortune of her recently dead husband. We also have images of vagabond single men living on the geographical margins, between the Indians and the settlers. There is much else in the book that grips the historical imagination; the book transports you to a society both plausible and very much different from our own in its facts and processes. Morgan's book also tells a lot through inference about the longer trajectory of American history as well as about what might happen with the narco-states that are still with us or that, from time to time, come into existence when the political instability of a region makes it available, however briefly, for being te drug production arm of a world wide drug market.
Virginia during its first half century had an extremely high death rate. Immigrants, most of whom were indentured servants, barely supplied a replacement population. In fact, indentured servants were more highly valued even if they had fewer years to serve on their contracts if they had been in Virginia for a few years because then they had been "seasoned" and so might survive illnesses that might have been caused by the impure water, the tropical conditions, scurvy, or something else.
Both free people and servants came to Virginia because they hoped to make quick fortunes by planting tobacco for export to England, some years the prices very high. There was abundant land to support tobacco crops even if a particular field could be planted only two or three years in a row before it was necessary to move on to a new set of fields. People lived in shacks; there were no towns; there were no urban amenities. Planters went to New Amsterdam for long visits to get away from the deadly summers and to find some civilized living. The preoccupation in Virginia was with the politics of what the home country, England, would allow in the way of tobacco imports, the ships laid up until they on-loaded the next crop serving as living accommodations. Some planters may have wanted to try alternative crops, but there was too much quick profit in tobacco.
The key issue for the tobacco economy was labor. The plants and climate were there; the land was there; the market was there. All that was needed was the labor, and that meant that the most valuable commodity was the contracts for labor service which could be traded or inherited, not all that many of the servants expected to live out their contracts, and even if they did, likely to sign up again for servitude to get out of debt and to get work. A very strong class system was setting in.
That sets the scene for a time when there would be fewer of those indentured service because they were no longer dying off as quickly, and so would lose their value to the holders of their contracts when those contracts expired. As Morgan so cogently explains it, there was a need for servants who would not be liberated either by death or by having survived. These were supplied through the purchase of slaves who would otherwise have been worked to death by the sugar planters in the Caribbean. A slightly higher price was paid for the slaves because they would return their purchase price many fold, but legislation was soon enough required to allow slaves to be severely punished, beaten close to death, to insure that they would work diligently, because indentured servants who were not diligent could have their terms of servitude extended, a mechanism of compliance obviously not available for slaves, who were already indentured for life. And so we have the development of a system of agriculture that depends on dehumanization and the unproductive use of labor so as to make gigantic profits for the few.
I might add that the advantages of a system that pays wages to inspire diligent work and does not require violence to insure the continuance of individual compliance or the survival of the system did not develop because this other system was already in place. Moreover, a wage system has within it the idea that people can better their own lives and the lives of their families while a slave system has no truck with the idea of ambition and so is contrary to the Protestant Ethic and the productive economy which it fosters. As William Graham Sumner argued, slavery was an outdated system from the start, one waiting around to die, even if there had been no invasion from the North. Too much wealth was invested by the South in slaves rather than in productive enterprises. Southerners might well have set up programs to emancipate slaves through subscriptions from Abolitionists, but they were too deeply ingrained with a sense of the virtue and inevitability of their system to try to find a way out of it.
Let us try to generalize and compare. Narco-states are dependent on labor because what the are producing is a specialized agricultural crop, whether that is cocoa leaves or marijuana or tobacco or alcohol. Such crops are different from other agricultural crops in that they are addictive or at least highly pleasant to use and so there is a market for them that is not easily squelched. It is best to find a product which can be moved without too much bulk to its markets, and that is why heroin is a superior product to marijuana, tobacco somewhere in the middle, while women and slaves are not so easily transported, and so customers for prostitutes by and large come to places where the prostitutes are and the transportation for captured slaves is a major cost in making them available and why they are so valuable once they have arrived.
This rule that small sized doses are the form of drugs that makes for the largest profits holds especially true when the sale of the product is illegal and so has to be smuggled, but British bottoms still had to take tobacco, which was legal, across an ocean, and so it was useful that small does of tobacco could get good prices. Gin becomes a competitor because it is more easily produced from any grain while whiskeys take longer to produce and so are like a "normal" industry where production expertise and so family capitalism make sense. The one who makes the money with illegal drugs is the exporter rather than the laborer or any of the middle men along the way.
To repeat Morgan's key insight: the wealth of the Virginia planter did not consist of the land, nor did it even consist of the tobacco itself, the price of that fluctuating. The wealth of the Virginia planter was in the labor contracts for indentured servants and, later, in the number of slaves owned. The more of these he had, the more tobacco and then cotton he could produce.
That is very different from extractive industries. Oil monarchies and dictatorships make money because they have legal or some other hold on the land from which mineral and carbon based wealth is extracted. That allows them to establish very comfortable lives for themselves, including trips to and condo in New York and London, and over extended leisure palaces and residences in Riyadh and Abu Dhabi, however much the creation of an infrastructure which will extend the wealth creating abilities of other segments of the population is neglected. That is why Irish landlords resident in London could have fortunes while their properties in Ireland were in shambles and the people could no longer manage even a subsistence agriculture. It is also very different from the California God Rush where wealth was transferred from the miners to those who supplied them with services, whether eggs or women or accommodations. The Gold Rush made San Francisco rich. Contemporary extractive nations get their trained oil ministers at Oxford and Princeton and no not locally train the neighborhood doctors or teachers that they need.
But those extractive nations are still more developed than the narco-nations. They are traditionalist and authoritarian rather than anarchic battlefields between rival armies fighting for control of the labor force and the fields, education and social services taking a back seat in the narco-nations to the protection of the industry, making some people very rich, but reducing most to abject poverty or displacement and fear as the battles go on around them. The same thing happened in the slave South, where levels of material wealth and culture remained considerably lower than they were in the north, however much Southerners prided themselves on their way of life.
The same dynamics hold for gang dominated neighborhoods in major American cities such as Chicago. The drug industry dominates the neighborhood because it is a major source of wealth for the neighborhood and because the industry employs a great number of people to serve as sellers, lookouts, deliverers, and enforcers. it is difficult to break the hold of gangs on these neighborhoods because the labor force the gangs recruit start very young. The gang members lead short, hectic lives until, like as not, they are shot in some drug related confrontation, leaving behind girl friends, children and, incredibly enough, closets full of sneakers, because that is what they spend their money on, along with jewelry for their girl friends. As in narco-states, the industry is very unproductive except for those at the top because so much has to be invested in time and energy and wealth in maintaining control of the unsteady peace rather than relying for that on a nation state with a police force and an army and a rule of law that allows industrial enterprises to focus on what they do best, which is to create and market a product.
The South never understood how expensive it was to the general welfare of the South to maintain slavery: the constant scrutiny of the slave population, a culture terrified of those who worked for it, an inefficient agriculture where people worked only as hard as they had to, the dependence on crops whose prices fluctuated while opportunities for other kinds of enterprise languished as not befitting the way of life, or indeed, the skills or the educational levels of those who ran or worked the plantations. The work of reclaiming the South from its economic origins still goes on.