The War for Tariffs, Taxes and Astonishing Profits

The war commenced by Lincoln in 1861 immediately presented his administration with the problem of a conflict the United States could simply not afford. In April 1861, federal spending was only about $172,000 a day, raised by tariffs and land sales. By the end of July 1861, Lincoln had caused this to increase to $1 million, and by the end of December it was up to $1.5 million per day. Also in December 1861 Northern banks had to stop paying their debts in gold, with the federal government doing the same shortly after and resorting to printing money. The country had gone off the gold standard, Wall Street was in a panic, and Lincoln would lament, “The bottom is out of the tub, what shall I do?” The cost of the war would eventually reach $8 billion, enough to have purchased the freedom of every slave five times over – and provided each with the proverbial 40 acres, and the mule.

Bernhard Thuersam, www.Circa1865.com

 

The War for Tariffs, Taxes and Astonishing Profits

“By May 1864 [financier Jay] Cooke was selling [Northern] war bonds so successfully that he was actually raising money as fast as the War Department could spend it, no mean feat for that was about $2 million a day at this point. Altogether, the North raised fully two-thirds of its revenues by selling bonds. If Abraham Lincoln must always be given the credit for saving the Union, there is also no doubt that the national debt was one of the most powerful tools at his disposal for forging victory.

Although the [Northern] people were willing to endure very high taxes during the war, peacetime was another matter altogether. Immediately after the war the cry for repeal of the wartime taxes became insistent. With military expenses quickly dropping, the problem, was what taxes to cut. American industrialists, who had prospered greatly thanks to wartime demand and wartime high tariffs, naturally did not want the tariffs cut.

Because the Civil War had broken the political power of the South, the center of opposition to the tariff, they got their way. The tariff was kept at rates far above the government’s need for revenue as the North industrialized at a furious pace in the last three decades of the nineteenth century and became the greatest – and most efficient – industrial power in the world.

Of course, no matter how large, efficient, and mature these industries became, they continued to demand [tariff] protection, and, thanks to their wealth and political power, get it.  As Professor William Graham Sumner of Yale explained as early as 1885, “The longer they live, the bigger babies they are.” It was only after the bitter dispute between Andrew Carnegie and Henry Clay Frick caused the astonishing profits of the privately held – and highly protected – Carnegie Steel Company to become public knowledge, in 1899, that the political coalition behind high tariffs began to crack.

Before the Civil War there had been little advocacy of an income tax in this country, at least at the federal level, although by the war six States had implemented such taxes for their own revenue purposes. But once a federal income tax was in place, thanks to the Civil War, it quickly acquired advocates, as political programs always do.

These advocates pushed the idea relentlessly . . . Republican Senator John Sherman . . . said during a debate on renewing the income tax in 1872, that “here we have in New York Mr. Astor with an income of millions derived from real estate . . . and we have along side of him a poor man receiving $1000 a year. [The law] is altogether against the poor man . . . yet we are afraid to tax Mr. Astor. Is there any justice in it? Why, sir, the income tax is the only one that tends to equalize these burdens between the rich and the poor.”

(Hamilton’s Blessing, John Steele Gordon, Penguin Books, 1997, pp. 79-83)

Virtue More Dangerous Than Vice

Horatio Seymour of New York always refused to consider any aspect of African slavery as a paramount issue in the country; He felt that “for seventy years the Union had existed with slavery; it need not perish overnight because of it.” He rightly saw anti-slavery rhetoric against the South as designed to divert attention from speculation and corrupt politics in the North.

Bernhard Thuersam, www.Circa1865.com

 

Virtue More Dangerous Than Vice

“As one looks back at the antics of the abolitionists – Garrison burning a copy of the Constitution in a public square; Gerrit Smith playing “possum” at an asylum while the John Brown he had encouraged was found guilty of treason and hauled out to be hanged; self-righteous ranters pleading from their pulpits for the export of rifles to Kansas; industrious Mrs. Stowe embalming the slippery sentimentality of her half-truths in the lachrymose pages of Uncle Tom’s Cabin; even Democratic David Wilmot trying to repair with his famous proviso the political fences he had broken down with his vote for a lower tariff . . .

[T]here comes to mind the words of the ancient philosopher which a president of Yale was always happy to remember”: “Virtue is more dangerous than vice because the excesses of virtue are not always subject to the restraints of conscience.”

(Horatio Seymour of New York, Stewart Mitchell, Harvard University Press, 1938, pp. 229-230)

Reconstruction, the Most Shameful Period of Our History

The following is an excerpt from an 1892 address by Lt. Col. Alfred Moore Waddell to the Alumni Association of the University of North Carolina. He served as a United States Congress 1871-1879.

Bernhard Thuersam, www.Circa1865.com

 

Reconstruction, the Most Shameful Period of Our History

“[Reconstruction] constitutes the one indelible and appalling disgrace of the American people — the one chapter of their history which contains no redeeming feature to relieve it from the endless execration of the civilized world.

A distinguished orator from a Northern State declared in Congress in 1872 that one-third of the boundaries of this Republic had been filled “with all the curses and calamities ever recorded in the annals of the worst governments known on the pages of history,” and attacking the [radical Republican] authors of these calamities, he exclaimed,

“From turret to foundation you tore down the governments of eleven States. You left not one stone upon another. You rent all their local laws and machinery into fragments, and trampled upon their ruins. Not a vestige of their former construction remained.”

And again he said:

“A more sweeping and universal exclusion from all the benefits, rights, trusts, honors, enjoyments, liberties, and control of government was never enacted against a whole people, without respect to age or sex, in the annals of the human race. The disgraceful disabilities imposed against the Jews for nearly eighteen hundred years by the blind and bigoted nations of the earth were never more complete or appalling.”

Those old enough to remember that most shameful period of our history will readily recall the degradation, the crimes against civilization, and the terrorism which then prevailed, and how, amidst the general dismay, the faint-hearted stood helpless and silent before the arbitrary and reckless power exercised over them.”

(The Life and Character of William L. Saunders, address to the Alumni Association of the University of North Carolina, Tuesday, May 31, 1892, Col. Alfred Moore Waddell of Wilmington)

Wading Through Blood of Men, Women and Children

Major Henry W. Conner (1793-1866) of Lincoln County, North Carolina was a democrat of the Nathaniel Macon type, and observed the growth of fanatic abolitionism in the North with great trepidation. His son, Lt. Charles T. Conner, was killed by Northern soldiers in 1865.

Bernhard Thuersam, www.Circa1865.com

 

Wading Through Blood of Men, Women and Children

“The following excerpts from the address made by Major [Henry W.] Conner in his campaign for reelection to Congress in 1839 show how the smoldering fires of anti-slavery sentiment were beginning to blaze in the North. Referring to it he said:

“Abolitionism, when I last addressed you seemed to be confined to a few fanatics only, and so absurd seemed their views and pretensions that serious apprehension could not reasonably be entertained, but such has been their rapid growth in a short time, that in several of the States they hold the balance of power in politics, and abolitionism has, therefore, become a political question with the avowed object of striking at the rights and property of the South, and there is reason to believe they will not be particular in the mode of carrying out their plans, whether peacefully, or by wading through blood of men, women and children.

The desks of abolition members (especially John Quincy Adams and Slade) are loaded with thousands of antislavery petitions which have be presented within the last two years, asking Congress to interfere with your rights and property. This heartless and unjustifiable policy must and will be met by the South at the proper time with manly determination to protect and defend our rights and privileges at all hazards.”

(The Annals of Lincoln County, North Carolina, William L. Sherrill, Regional Publishing, 1972, pp. 188-189)

 

 

 

 

War — Even if Slavery Were Removed as an Issue

Abolitionist Moncure Conway saw deeper into the question of immediate emancipation than most of his contemporaries. He rightly sensed that the more fierce the North’s desire to subjugate the South became, the more the black man would be used as a weapon to achieve their goal of political supremacy. The postwar Union League which incited Southern blacks against their white neighbors followed this stratagem, against which the Ku Klux Klan became the predictable antidote.

Bernhard Thuersam, www.Circa1865.com

 

War – Even if Slavery Were Removed as an Issue

“Conway’s disenchantment with the Northern cause began in 1862 when his deep-seated hatred of war came again to the fore, overcoming his bellicosity of the previous year. In April, he wrote to Charles Sumner on his recent lecture tour “a growing misgiving that a true peace cannot be won by the sword in an issue of this nature.” His second book, The Golden Hour, which was published that same year, displayed an increasing concern with the evils of war.

“The moralization of the soldier,” Conway now wrote, “is the demoralization of the man. War is the apotheosis of brutality . . . Should we continue this war long enough, we shall become the Vandals and Hessians the South says we are.”

Complaints about the low morale of the troops meant to him simply that the Northern soldier was still civilized and under the influence of Christian morality. The inescapable conclusion was that the longer the war continued, the more savage and brutalized the North would become. Here he generalized the insight at the end of The Rejected Stone that if emancipation did not come before it became a “fierce” necessity, it would reflect war passions rather than benevolence.

After the President did take up his pen and sign the [proclamation], Conway felt that it was too little and too late. In part this may have reflected his disappointment that the war continued as fiercely as ever; for he had refused as an optimistic humanitarian to believe that the eradication of one evil might require acceptance of another. A case can be made for the theory that Lincoln framed and enforced his edict in such a way that the fewest possible slaves would be freed – while at the same time taking the bite out of antislavery criticism of the administration.

By April 1863, when he sailed for England as an unofficial envoy of the American abolitionists, Conway was completely fed up with the bloody conflict which e saw as inflicting terrible damage on the South without adequate justification . . . and in any case, war was a worse evil than slavery.

Soon after arriving in England, Conway stirred up a hornet’s nest by making a peace offer to James M. Mason, the Confederate envoy, which he innocently misrepresented as coming from the American abolitionists. Conway proposed to Mason that if the South would abolish slavery on its own, the antislavery men of the North would “immediately oppose the further prosecution of the war . . . ”

The storm that broke over the head of poor Conway was something from which he never fully recovered. Almost to a man the abolitionists condemned and repudiated his offer. Conway now understood, apparently for the first time, that many of the abolitionists were devoted to a war which would crush the South even if slavery were removed as an issue.”

(The Inner Civil War, Northern Intellectuals and the Crisis of the Union, George M. Frederickson, Harper & Row, 1965, pp. 123-125)

Betrayed by Yankees Perverting the Constitution

The presidential messages of Jefferson Davis were filled with assertions of the South’s legal right to secede and form a more perfect union, and determine its own form of government to the letter of Jefferson’s Declaration of Independence. Not losing sight of this, even in early 1865, one Confederate congressman stated that “This is a war for the Constitution, it is a constitutional war.”

Bernhard Thuersam, www.Circa1865.com

 

Betrayed by Yankees Perverting the Constitution

“Contributors to Confederate periodicals explored parallels between the Confederacy and other fledgling nations or independence movements – the Dutch republic, the “young kingdom of Italy,” and the Polish and Greek rebellions.

But the authors were careful to dissociate the South from genuinely radical movements; it was the conservative European nationalism of the post-1848 period with which the Confederacy could identify most enthusiastically. The Dutch struggle, an essayist in the July, 1862, issue of the Southern Presbyterian Review explained approvingly, was like the Confederate, for in both situations, “not we, but our foes, are the revolutionists.”

The Daily Richmond Enquirer was even more explicit about the Poles:

“There is nothing whatever in this movement of a revolutionary, radical or Red Republican character. It is the natural, necessary protest and revolt of, not a class or order, but an ancient and glorious nation, against that crushing, killing union with another nationality and form of society. It is . . . the aristocratic and high-bred national pride of Poland revolting against the coarse brute power of Russian imperialism . . . At bottom, the cause of Poland is the same cause for which the Confederates are now fighting.”

The Southern government welcomed a Spanish analogy between Napoleon’s invasion of Spain and northern advances across the Potomac. British recognition of the new Italian state encouraged [Robert] Toombs to see parallels there, as well. “Reasons no less grave and valid than those which actuated the people of Sicily and Naples,” he explained, had prompted the Confederacy to seek its independence.

But the nationalist movement with which the Confederates most frequently identified was . . . the American War of Independence. A central contention of Confederate nationalism, as it emerged in 1861, was that the South’s effort represented a continuation of the struggle of 1776. The South, Confederates insisted, was the legitimate heir of American revolutionary tradition. Betrayed by Yankees who had perverted the true meaning of the Constitution, the revolutionary heritage could be preserved only by secession. Southerners portrayed their independence as the fulfillment of American nationalism.

Secession represented continuity, not discontinuity; the Confederacy was the consummation, not the dissolution, of the American dream. A sermon preached in South Carolina explained that “The doctrines of the original Puritans were, and are, the doctrines of the Bible . . . but the descendants of the Puritans have gone far astray from the creed of their forefathers.”

[Southerners strived] to avoid the dangerous “isms” – feminism, socialism, abolitionism – that had emerged from Northern efforts at social betterment. But the logic of Confederate nationalism . . . was to prescribe significant shifts in the Southern definition of Christian duty. Secession thus became an act of purification, a separation from the pollutions of decaying Northern society, that “monstrous mass of moral disease,” as the Mobile Evening News so vividly described it.”

(The Creation of Confederate Nationalism, Drew Gilpin Faust, LSU Press, 1988, pp. 13-14, 27, 29-30)

War Profiteering in the North

Published as a textbook well before America’s cultural revolution of the 1960’s, John Hicks “The Federal Union” can be trusted as a fairly accurate source of United States history and free of cultural Marxist revisionism. Below, he touches on the North’s generous government supply contracts, child labor and general wartime prosperity while its bounty-enriched blue-clad soldiers devastated Americans in the South to preserve a territorial Union.

Bernhard Thuersam, www.Circa1865.com

 

War Profiteering in the North

“When the Civil War broke out the North had not fully recovered from the depression that had followed the panic of 1857, and for a time business interests were more frightened than stimulated by the clash of arms. By the summer of 1862, however, a surge of prosperity had put in its appearance that was to outlast the war.

With millions of men under arms the [Northern] government was a dependable and generous purchaser of every kind of foodstuff, and its equally great need of woolen goods and leather strengthened the market also for raw wool and hides. Probably the sales of the farmers made directly or indirectly to the government more than offset the losses sustained by wartime interference with sales to the South.

[And] with the South out of the Union, a homestead law, so long the goal of believers in free land, was speedily enacted (1862). Thereafter any person who was head of a family, or had arrived at the age of twenty-one years, whether a citizen of the united States or an alien who had declared his intention of becoming a citizen, might take up a quarter section of public land, and, after having lived upon it for five years and improved it, might receive full title to it virtually free of charge.

What came in later years to be called “heavy industries” profited enormously from the war. Purchases of munitions abroad practically ceased after the first year because of the rapidity with which American factories supplied the government’s needs . . . the government itself went deeply into the business of manufacturing war materials as public opinion would permit.

High tariffs ensured the northern manufacturers against the dangers of foreign competition. A protectionist policy had been demanded by the Republican national platform of 1860, and a higher schedule of tariffs . . . was placed upon the statute books two days before [President James] Buchanan left office. This speedy answer to the prayers of the protectionists was made possible by the withdrawal from Congress of the delegations from the seven seceding States of the lower South, and by the fact that President Buchanan was no longer unmindful of the wishes of the manufacturers of his home State [of Pennsylvania].

The original Morrill Tariff Act was repeatedly revised upward during the war, until by 1864 the average of duties levied on imports had reached forty-seven per cent, the highest thus far in the history of the nation. The significance of this development can scarcely be overemphasized. A policy which the South had persistently blocked in the years preceding the war became an actuality during it, and as subsequent events were to prove, remained as a permanent fixture in American political and economic life.

The profits of war bred a spirit of extravagance and frivolity among the non-combatants of the north that contrasted oddly with the long casualty lists displayed as a regular part of the daily news. Social life reached a dizzying whirl, with more parties and dances, theaters and circuses, minstrel shows and musicales than ever had been known before.

According to a statement published by the Springfield Republican in 1864, many of the factories whose profits during the war had been “augmented beyond the wildest dreams of their owners” paid their laborers only from twelve to twenty per cent more than before the war. “There is absolute want in many families, while thousands of young children who should be in school are shut up at work that they may earn something to eke out the scant supplies at home.”

(The Federal Union, A History of the United States to 1865, John D. Hicks, Houghton Mifflin Company, 1948, pp. 660-665)

Washington Will Be a Fortified City

Lemuel Burkitt (1750-1807) was a Baptist preacher and member of the 1788 Hillsborough Convention which considered the new union proposed by Alexander Hamilton. A devout anti-Federalist, he demanded a maximum of State rights and the preservation of individual liberties, and thus was highly suspicious of Hamilton’s centralization of power schemes.

Bernhard Thuersam, www.Circa1865.com

 

Washington Will Be a Fortified City

“At the sessions of the courts, at county militia musters, in the taverns, wherever men gathered, the main topics of conversation [in 1787] were the Constitution and its framers. In the heat of argument no man’s character was above attack and no past political or military service could overcome party animosity. Thomas Person, a general of the Revolution and patriot of undoubted sincerity, denounced Washington as “a damned rascal and traitor to his country for putting his hand to such an infamous paper as the new Constitution.”

Willie Jones, leader of the [North Carolina] anti-federalists, found it necessary to deny in the public press that he had “called the Members of the Grand Convention, generally, and General Washington and Col. Davie, in particular, scoundrels” . . . William Lenoir of Wilkes county said later in the debates in the convention that his constituents had instructed him to oppose the adoption of the Constitution. William Lancaster of Franklin [county] said that his own feelings and his duty to his constituents induced him to oppose the adoption of the Constitution, since he believed every delegate was bound by his instructions.

Lemuel Burkitt, a Baptist preacher strongly opposed to ratification, was a [convention] candidate in Hertford county. In explaining the selection of an area ten square miles [to be] the seat of the [federal] government, Burkitt said: “This my friends, will be walled in or fortified. Here an army of fifty thousand, or perhaps, a hundred thousand men, will be finally embodied, and will sally forth, and enslave the [American] people, who will be gradually disarmed.”

[Hugh] Williamson . . . did not consider paper currency as honest tender because of its rapid depreciation. However convenient depreciated paper appeared to those who used it to discharge their debts, he contended that the credit and finances of the State had been injured by it. No part of the North Carolina debt of North Carolina had been discharged by the operations of paper money, “the whole advantage of depreciation being a mere juggle,” by which one citizen was injured for the convenience of another.”

So great were the evils of paper money that the dignity of government was wounded by declaring it legal tender, industry languished, the orphan was defrauded, and the most atrocious frauds were practiced under the sanction of the law.”

(The Ratification of the Federal Constitution in North Carolina, Louisa Irby Trenholme, Columbia University Press, pp. 107-110; 117)

“The Argument is Exhausted . . .”

Those in South Carolina with Unionist views in late 1860 realized that the revolutionary Republicans of the North would agree to no compromise, and a secession convention received wide support among them. This encouragement for South Carolina’s independent action was exemplified by Charlestonian Richard Yeadon stating on November 15 that he had been “amongst those rather noted for their devotion to the Union,” but that “he worshipped at that shrine no longer.”

Bernhard Thuersam, www.Circa1865.com

 

“The Argument is Exhausted . . .”

“In the December 6 election of delegates to the secession convention voting in most places was light, a fact that has sometimes been interpreted as indicating a strong reaction from the secession enthusiasm so manifest at the time of the passage of the convention bill. Actually the light vote must be explained by the absence, in most places, of a contest.

When the secession convention met December 17, South Carolina was confident that her action would soon be followed by other States. Governor Gist, in his message to the legislature at the end of November, had stated that there was not the least doubt that Georgia, Alabama, Mississippi, Florida, Texas and Arkansas would immediately follow, and eventually all the South. Several days before the convention assembled, John A. Elmore and Charles E. Hooker, commissioners from Alabama and Mississippi respectively, arrived in Columbia. They interviewed practically every member of the legislature and the assembling convention, and positively guaranteed secession in their States.

Early in December a caucus of twenty-six Southern congressmen from eight States met and unanimously decided that immediate action by South Carolina was desirable. Soon thereafter the very encouraging address of the Southern congressmen to their constituents appeared:

“The argument is exhausted. All hope of relief in the Union through the agency of committees, Congressional legislation, or constitutional amendment, is extinguished, and we trust the South will not be deceived by appearances or the pretense of new guarantees. In our judgment the Republicans are resolute in the purpose to grant nothing that will or ought to satisfy the South. We are satisfied the honor, safety, and independence of the Southern People require the organization of a Southern Confederacy – a result to be obtained only by separate State secession.”

Assembling at the Baptist church in Columbia December 17, the convention called D.F. Jamison, delegate from Barnwell. If elections meant anything, he said, the State should secede as quickly as possible. The greatest honor of his life, he said, would be to sign as chairman of the convention an ordinance of secession.”

(South Carolina Goes to War, 1860-1865, Charles Edward Cauthen, UNC Press, 1950, pp. 63-68)

Virginia Seeks Peace, Radicals Seek War

No initiatives for peaceful compromise, nor peaceful and practical solution to African slavery were forthcoming from either Abraham Lincoln or the Republican party. Their policy since Lincoln’s election was steadfast resistance to any measures that would resolve the sectional differences. Congress was by February 1861 dominated by Northern politicians after the departure of several Southern States and had free reign over legislation which would have averted war between Americans.

Bernhard Thuersam, www.Circa1865.com

 

Virginia Seeks Peace, Radicals Seek War

“[T]he Old Dominion, true to her traditional policy of taking the initiative in times of crisis, assumed the role of peacemaker. The legislature passed joint resolutions on January 19 calling for a peace convention to be held in Washington. An invitation was extended to the other States to appoint commissioners to meet in Washington on February 4 “to consider and, if practical, agree upon some suitable adjustment.” The opinion was expressed that the Crittenden Compromise, then pending in the Senate, would with some modification serve as a basis for adjustment.

These resolutions provided for the appointment of [former President] John Tyler as commissioner to the President of the United States and Judge John Robertson commissioner to the seceded States. They were instructed respectively to request the President . . . and the authorities of the seceded States to abstain, pending the action of the proposed peace convention, from “all acts calculated to produce a collision of arms between the States and the Government of the United States.”

Congress, however, paid no attention to the Virginia resolutions. In neither House were they printed or referred to a committee. They were soon allowed to lie on a table unnoticed.

Tyler left Washington on January 29 with the expectation of returning for the Peace Convention . . . On the day before leaving, he sent another letter to President Buchanan [which] expressed appreciation for the courtesies that had been shown him and pleasure of hearing the President’s message read in the Senate. He spoke of a rumor to the effect that at Fortress Monroe the cannon had been put on the land side and pointed inland.

His comment on this report was “that when Virginia is making every possible effort to redeem and save the Union, it is seemingly ungenerous to have cannon leveled at her bosom.” To this letter Buchanan sent a very courteous reply, stating that he would inquire into the rumors with reference to Fortress Monroe.”

(John Tyler, Champion of the Old South, Oliver Perry Chitwood, American Historical Association, 1939, pp. 436-438)