Derek Thompson: The Spectacular Rise and Fall of U.S. Whaling: An Innovation Story

Derek Thompson is a senior editor at The Atlantic, where he oversees business coverage for the website.

One hundred and fifty years ago, around the time Herman Melville was completing Moby Dick, whaling was a booming worldwide business and the United States was the global behemoth. In 1846, we owned 640 whaling ships, more than the rest of the world put together and tripled. At its height, the whaling industry contributed $10 million (in 1880 dollars) to GDP, enough to make it the fifth largest sector of the economy. Whales contributed oil for illuminants, ambergris for perfumes, and baleen, a bonelike substance extracted from the jaw, for umbrellas.

Fifty years later, the industry was dead. Our active whaling fleet had fallen by 90 percent. The industry's real output had declined to 1816 levels, completing a century's symmetry of triumph and decline. What happened? And why does what happened still matter?...

Between the 1860s and the 1880s the wages of average US workers grew by a third, making us three times more expensive than your typical Norwegian seaman. Whales aren't national resources. They're supranational resources. They belong to whomever can hunt them most efficiently. With all the benefits of modern whaling technology and workers at a third the price, Norway and other countries snagged a greater share of the world's whales.

As the costs of whaling grew, capitalists funneled their cash into other domestic industries: notably railroads, oil, and steel. When New Bedford's whaling elite opened the city's first cotton mill and petroleum-refining plant, the harpoon had been firmly lodged inside the heart of American whaling. Ishmael complained famously, in the first paragraph of Moby Dick, of having "nothing particular to interest me on shore," so he struck out to earn a living wage at sea. In the second half of Melville's century, the industrial revolution lured young men without means to factories rather than the ocean. Capital beckoned the nation's Ishmaels to the machines, away from the watery parts of the world....