Economists and economic historians tend to use the terms capital and machinery interchangeably, even though machinery rarely constitutes one-fifth and sometimes is as little as one-tenth of a nation’s reproducible tangible assets. This habit can distort the way economists think and talk about important issues. In economic history, disproportionate attention to machinery helps explain why the “Habakkuk” debate, which has now spanned several decades, has been premised on the need to rationalize empirical regularities the opposite of those in need of explanation. In manufacturing and, indeed, in the economy in the aggregate, the United States was less, not more capital intensive than Britain in 1860.