No nation has ever had the rich supply of resources to face the future that the U.S. economy has as it enters the 21st century. Despite that, or perhaps because of it, U.S. consumers, businesses, and political leaders are still trying to do more than earlier generations of citizens.

XI CHIEF GOODS AND SERVICES OF THE U.S. ECONOMY

The U.S. economy, the largest in the world, produces many different goods and services. This can be seen more easily by dividing economic activities into four sectors that produce different kinds of goods and services. The first sector provides goods that come directly from natural resources: agriculture, forestry, fishing, and mining. The second sector includes manufacturing and the generation of electricity. The third sector, made up of commerce and services, is now the largest part of the
U.S. economy. It encompasses financial services, retail and wholesale sales, government services, transportation, entertainment, tourism, and other businesses that provide a wide variety of services to individuals and businesses. The fourth major economic sector deals with the recording, processing, and transmission of information, and includes the communications industry.

A Natural Resource Sector

The United States, more than most countries, enjoys a wide array of natural resources. Agricultural output in the United States has historically been among the highest in the world. Rich fishing grounds and coastal habitats provide abundant seafood. Companies harvest the nation’s large reserves of timber to use in wood products and housing.
Major mineral resources—including iron ore, lead, and copper, as well as energy resources such as coal, crude oil, and natural gas—are abundant in the United States.

A1 Agriculture

The United States contains some of the best cropland in the world.
Cultivated farmland constitutes 19 percent of the land area of the country and makes the United States the world’s richest agricultural nation. In part because of the nation’s favorable climate, soil, and water conditions, farmers produce huge quantities of agricultural commodities and a variety of crops and livestock.

The United States is the largest producer of corn, soybeans, and sorghum, and it ranks second in the production of wheat, oats, citrus fruits, and tobacco. The United States is also a major producer of sugar cane, potatoes, peanuts, and beet sugar. It ranks fourth in the world in cattle production and second in hogs. The total annual value of farm output increased from $55 billion in 1970 to $202 billion in 1996. Farmers in the United States not only produce enough food to feed the nation’s population, they also export more farm products than any other nation.
Despite this vast output, the U.S. economy is so large and diversified that agriculture accounted for only 2 percent of annual GDP and employed only 3 percent of the workforce in 1998.

During the 20th century, many Americans moved from rural to urban areas of the United States, resulting in large population decreases in farming regions. Even though the number of farms has been declining since the
1930s, overall production has increased because of more efficient operations. Bigger farms, operated as large businesses, have increasingly replaced small family farms. The owners of larger farms make greater use of modern machinery and other equipment. By the 1990s, farm operations were highly mechanized. By applying mechanization, technology, efficient business practices, and scientific advances in agricultural methods, larger farms produce great quantities of agricultural output using small amounts of labor and land.

In 1999 there were 2,194,070 farms in the United States, down from a high of 6.8 million in 1935. As smaller farms have been consolidated into larger units, the average farm size in the United States increased from about 63 hectares (about 155 acres) to 175 hectares (432 acres) by 1999.

Cattle production is widespread throughout the United States. Texas leads in the production of range cattle, which are allowed to graze freely.
Iowa and Illinois are important for nonrange feeder cattle, which are cattle that eat feed grain provided by cattle farmers. The Dairy Belt continues to be concentrated in southern Wisconsin but is also prominent in the rural landscapes of most northeastern states and fairly common in other states, too. Hog production tends to be concentrated in Iowa,
Illinois, and surrounding states, where hogs are fattened for market.
Chicken production is widespread, but southern states, including Texas,
Arkansas, and Alabama, dominate.

Corn and soybean production is concentrated heavily in Iowa and Illinois and is also important in surrounding states, including Missouri, Indiana,
Nebraska, and the southern regions of Minnesota and Wisconsin. Wheat is another important U.S. crop. Kansas usually leads all states in yearly wheat production. North Dakota, Montana, Oklahoma, Washington, Idaho,
South Dakota, Colorado, Texas, Minnesota, and Nebraska also are major wheat producers.

For more than a century and a half, cotton was the predominant cash crop in the South. Today, however, it is no longer important in some of the traditional cotton-growing areas east of the Mississippi River. While some cotton is still produced in the Old South, it has become more important in the Mississippi Valley, the Panhandle of Texas, and the
Central Valley of California. Cotton is shipped to mills in the eastern
United States and is exported to cotton textile plants in Japan, South
Korea, Indonesia, and Taiwan.

Vegetables are grown widely in the United States. Outside major U.S. cities, small farms and gardens, known as truck farms, grow vegetables and some varieties of fruits for urban markets. California is the leading vegetable producing state; much of its cropland is irrigated.

Most fruits grown in the United States fall in the categories of midlatitude and citrus fruits. Midlatitude fruits, such as apples, pears, and plums, grow in northern states including Washington, Michigan,
Pennsylvania, and New York. Citrus fruits—lemons, oranges, and grapefruits—thrive in Florida, southern Texas, and southern California.
Nuts grow on irrigated land in the Central Valley of California and in parts of southern California.

Production of specialty crops and livestock has increased in recent years, particularly along the East and West coasts and in the Southeast.
Ranches in New York and Texas have introduced exotic game, such as emu, fallow deer, and nilgai and black buck antelope. Deer and antelope meat, known as venison, is served mainly in restaurants. Specialty vegetable and fruit operations produce dwarf apples, brown and green cotton, canola, and jasmine rice. Farmers raise more than 60 specialty crops in the United States for Asian-American markets, including bean sprouts, snow peas, and Chinese cabbage.

A2 Forestry

In the 1990s, less than 1 percent of the country’s workforce was involved in the lumber industry, and forestry accounted for less than 0.5 percent of the nation’s gross domestic product (GDP). Nevertheless, forests represent a crucial resource for U.S. industry. Forest resources are used in producing housing, fuel, foodstuffs, and manufactured goods. The
United States leads the world in lumber production and is second in the production of wood for pulp and paper manufacture. These high production levels, however, do not satisfy all of the U.S. demand for forest products. The United States is the world’s largest importer of lumber, most of which comes from Canada.

When European settlers first arrived in North America, half of the land on the continent was covered with forests. The forests of the eastern and northern portions of the country were fairly continuous. Beginning with the early colonists, the natural vegetation was altered drastically as farmers cleared land for crops and pastures, and cut trees for firewood and lumber. In the north and east, lumbermen quickly cut all of the valuable trees before moving on to other locations. Only 10 percent of the original virgin timber remains. Almost two thirds of the forests that remain have been classified as commercial resources.

Forests still cover 23 percent of the United States. The trees in the nation’s forests contain an estimated 7.1 billion cu m (249.3 billion cu ft) of wood suitable for lumber. Private individuals and businesses, including farmers, lumber companies, paper mills, and other wood-using industries, own about 73 percent of the commercial forestland. Federal, state, and local governments own the remaining 27 percent.

Softwoods (wood harvested from cone-bearing trees) make up about three- fourths of forestry production and hardwoods (wood harvested from broad- leafed trees) about one-fourth. Nearly half the timber output is used for making lumber boards, and about one-third is converted to pulpwood, which is subsequently used to manufacture paper. Most of the remaining output goes into plywood and veneer. Douglas fir and southern yellow pine are the primary softwoods used in making lumber, and oak is the most important hardwood.

About half of the nation’s lumber and all of its fir plywood come from the forests of the Pacific states, an area dominated by softwoods. In addition to the Douglas fir forests in Washington and Oregon, this area includes the famous California redwoods and the Sitka spruce along the coast of Alaska. Forests in the mountain states of the West cover a relatively small area, yet they account for more than 10 percent of the nation’s lumber production. Ponderosa pine is the most important species cut from the forests of this area.

Forests in the South supply about one-third of the lumber, nearly three- fifths of the pulpwood, and almost all the turpentine, pitch, resin, and wood tar produced in the United States. Longleaf, shortleaf, loblolly, and slash pine are the most important commercial trees of the southern coastal plain. Commercially valuable hardwood trees, such as gum, ash, pecan, and oak, grow in the lowlands along the rivers of the South.

The Appalachian Highland and parts of the Great Lakes area have excellent hardwood forests. Hickory, maple, oak, and other hardwoods removed from these forests provide fine woods for the manufacture of furniture and other products.

In the 1990s the forest products industry was undergoing a transformation. New environmental requirements, designed to protect wildlife habitat and water resources, were changing forest practices, particularly in the West. The amount of timber cut on federal land declined by 50 percent from 1989 to 1993.

A3 Fishing

The U.S. waters off the coast of North America provide a rich marine harvest, which is about evenly split in commercial value between fish and shellfish. Humans consume approximately 80 percent of the catch as food.
The remaining 20 percent goes into the manufacturing of products such as fish oil, fertilizers, and animal food.

In 1997 the United States had a commercial fish catch of 5.4 million metric tons. The value of the catch was an estimated $3.1 billion in
1998. In most years, the United States ranks fifth among the nations of the world in weight of total catch, behind China, Peru, Chile, and Japan.

Marine species dominate U.S. commercial catches, with freshwater fish representing only a small portion of the total catch. Shellfish account for only one-sixth of the weight of the total catch but nearly one-half of the value; finfish represent the remaining share of weight and value.
Alaskan pollock and menhaden, a species used in the manufacture of oil and fertilizer, are the largest catches by tonnage. The most valuable seafood harvests are crabs, salmon, and shrimp, each representing about one-sixth of the total value. Other important species include lobsters, clams, flounders, scallops, Pacific cod, and oysters.

Alaska leads all states in both volume and value of the catch; important species caught off Alaska’s coast include pollock and salmon. Other leading fishing states, ranked by value, are Louisiana, Massachusetts,
Texas, Maine, California, Florida, Washington, and Virginia. Important species caught in the New England region include lobsters, scallops, clams, oysters, and cod; in the Chesapeake Bay, crabs; and in the Gulf of
Mexico, menhaden and shrimp.

Much of the annual U.S. tonnage of commercial freshwater fish comes from aquatic farms. The most important species raised on farms are catfish, trout, salmon, oysters, and crawfish. The total annual output of private catfish and trout farms in the mid-1990s was 235,800 metric tons, valued at more than $380 million. In the 1970s catfish farming became important in states along the lower Mississippi River. Mississippi leads all states in the production of catfish on farms.

A4 Mining

As a country of continental proportions, the United States has within its borders substantial mineral deposits. America leads the world in the production of phosphate, an important ingredient in fertilizers, and ranks second in gold, silver, copper, lead, natural gas, and coal.
Petroleum production is third in the world, after Russia and Saudi
Arabia.

Mining contributes 1.5 percent of annual GDP and employs 0.5 percent of all U.S. workers. Although mining accounts for only a small share of the nation’s economic output, it was historically essential to U.S. industrial development and remains important today. Coal and iron ore are the basis for the steel industry, which fabricates components for manufactured items such as automobiles, appliances, machinery, and other basic products. Petroleum is refined into gasoline, heating oil, and the petrochemicals used to make plastics, paint, pharmaceuticals, and synthetic fibers.

The nation’s three chief mineral products are fuels. In order of value, they are natural gas, petroleum, and coal. In 1996 the United States produced 23 percent of the world’s natural gas, 21 percent of its coal, and 13 percent of its crude oil. From 1990 to 1995, as the inflation- adjusted prices for these products declined, the extraction of these fossil fuels declined, increasing U.S. dependence on foreign sources of oil and natural gas.

The United States contains huge fields of natural gas and oil. These fields are scattered across the country, with concentrations in the midcontinent fields of Texas and Oklahoma, the Gulf Coast region of Texas and Louisiana, and the North Slope of Alaska. Texas and Louisiana account for almost 60 percent of the country’s natural gas production. Today, oil and natural gas are pumped to the surface, then sent by pipeline to refineries located in all parts of the nation. Offshore deposits account for 13 percent of total production. Coal production, important for industry and for the generation of electric power, comes primarily from
Wyoming (29 percent of U.S. production in 1997), West Virginia (18 percent), and Kentucky (16 percent).

Important metals mined in the United States include gold, copper, iron ore, zinc, magnesium, lead, and silver. Iron ore is found mainly in
Minnesota, and to a lesser degree in northern Michigan. The ore consists of low-grade taconite; U.S. deposits of high-grade ores, such as hematite, magnetite, and limonite, have been consumed. Leading industrial minerals include materials used in construction—mainly clays, lime, salt, phosphate rock, boron, and potassium salts. The United States also produces large percentages of the world’s output for a number of important minerals. In 1997 the United States produced 42 percent of the world’s molybdenum, 34 percent of its phosphate rock, 22 percent of its elemental sulfur, 17 percent of its copper, and 16 percent of its lead.
Major deposits of many of these minerals are found in the western states.

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