Your post is quite interesting and (having read a large number of your other posts) seems to be informed by a lot of good solid research. However, I question your conclusion that the US Navy did a poor job with the blockade.
The Navy had no preparation for this assignment and was obliged to build up a large fleet to make the blockade effective. That takes time. The naval technology of the time was very primitive compared to what we are used to today, so the initial success of the blocakade runners should be no surprise. Yes, it did take about three years to make the blockade strategically effective, but the US Navy did suceed in doing it, while also doing an admirable job in completing some of its other assignments, such as building a powerful fleet of riverine monitors in support of the Army.
At no point during the war did the Federal Navy post serving officers - either overtly or covertly - at the consulates at St. Georges', Bermuda; Nassau, The Bahamas; or Havana, Cuba; to conduct or support the collection of intelligence on the blockade running trade. Such information as was collected was collected by the Department of State civilians at the consulates who had
no training in intelligence collection or reporting, or in human intelligence source recruitment. There were even gaps in Department of State's manning of those consulates.
The Federal Navy never detailed a fast dispatch boat to run a circuit between St. George's, Nassau, Havana, and Key West to collect reports from the consuls and quickly run them to the Navy. Instead the consuls' despatches went into the diplomatic bag which was transported on British mail steamers to New York, Boston, or Philadelphia. There is information to believe that the bags were being opened and the despatches read. Unlike the "cousins," the British did have a real intelligence collection establishment.
One of the consuls in Nassau formed a human intelligence collection network of Negro wrecker captains who reported to him in detail on the blockade running trade. The consul proposed to Secretary Wells through Secretary Seward that the Negroes get a cut of the prize money from any runners captured as a result of their information. Wells refused, claiming that the Navy had no money to pay for it. The probable real reason is that it would have cut into the squids' prize money.
The Navy never established any form of intelligence cell, either in Washington or at fleet level, for analysis of the extensive intelligence on the trade it was receiving from Department of State's consulates and legations. The closest it came was a bi-weekly newsletter published later in the war by the North Atlantic Blockading Squadron containing extracts from the State Department despatches.
There is an abundance of reports from the blockade runners themselves that Navy captains were more interested in capturing their ships for the prize money than they were in stopping the ships. Why destroy a ship through gun fire on this trip when you might capture her on the next and collect the prize money?
Captured ships which the Navy did not purchase at prize auctions were sold to other purchasers, frequently going back into the blockade running trade. How bizarre is that. You have to buy a ship that was captured using Navy ships and crews? There were ships which were captured three or four times in "catch and release" blockading. The Navy would have been better off expending any captured ships that it didn't want as targets, but that would have interfered with the flow of prize money.
I recognize the problems in building an effective Navy, and the communications problems in the days prior to underwater telegraph lines and radios. My problem with the Navy is its failure to competently use what it had, and in the greed engendered by the prize money system. Rear Admiral Lee - who published the news letters mentioned above - referred to the North Atlantic Blockading Squadron as the "prize money command." His 10% cut from the ships captured by his command was equivalent to about 2.5 million dollars today. In one capture a captain, or even a ship's boy, could make more than the Navy paid him in a year in salary.
Regards,
Don Dixon