A Short History of Reconstruction [Updated Edition]

by Eric Foner

Recause of the region’s chronic capital shortage and scarcity of banking institutions, local merchants generally represented the only source of available credit. With land values having plummeted, merchants usually advanced loans only in exchange for a lien on the year’s cotton crop, rather than take a mortgage on real estate, as was conventional in the North. The emergence of the crop lien as the South’s major form of agricultural credit forced indebted farmers to concentrate on cotton, further expanding production and depressing prices. By 1880, one-third of the white farmers in the cotton states were tenants renting either for cash or a share of the crop, and a region self-sufficient before the Civil War was no longer able to feed itself.