John C. Calhoun on Tariffs

leftyhunter

Brev. Brig. Gen'l
Joined
May 27, 2011
Location
los angeles ca
Confederacy imposed Tariffs. Those revenues stayed in the Confederacy. Most assuredly, the inflated price paid for Yankee Manufactured Goods, did not.

So, if you wanted to expand your economy, might you want to manufacture your own goods, collect your own taxes? Many Fire Eaters thought so. Slavery was a labor solution. Just like importing poor immigrants and paying them starvation wages. Neither is an economy.
That seems a bit disengenuous . There were poor immigrants who worked in the South for low wages as well. No capitalist nation didn't use low paid labor and often used low paid immigrants.
Leftyhunter
 

Andersonh1

Brigadier General
Moderator
Joined
Jan 12, 2016
Location
South Carolina
Calhoun discussed the inequity of tariffs/duties in his final speech, the one he had to have Virginia senator James Mason else read for him.

http://blueandgraytrail.com/event/Speech_by_John_C._Calhoun,_March_4,_1850
The next is the system of revenue and disbursements which has been adopted by the government. It is well known that the government has derived its revenue mainly from duties on imports. I shall not undertake to show that such duties must necessarily fall mainly on the exporting States, and that the South, as the great exporting portion of the Union, has in reality paid vastly more than her due proportion of the revenue; because I deem it unnecessary, as the subject has on so many occasions been fully discussed. Nor shall I, for the same reason, undertake to show that a far greater portion of the revenue has been disbursed in the North, than its due share; and that the joint effect of these causes has been to transfer a vast amount from South to North, which, under an equal system of revenue and disbursements, would not have been lost to her. If to this be added that many of the duties were imposed, not for revenue but for protection--that is, intended to put money, not in the Treasury, but directly into the pocket of the manufacturers--some conception may be formed of the immense amount which in the long course of sixty years has been transferred from South to North. There are no data by which it can be estimated with any certainty; but it is safe to say that it amounts to hundreds of millions of dollars. Under the most moderate estimate it would be sufficient to add greatly to the wealthy of the North, and thus greatly increase her population by attracting immigration from all quarters to that section.​
 
Last edited:

unionblue

Brev. Brig. Gen'l
Member of the Year
Joined
Feb 20, 2005
Location
Ocala, FL (as of December, 2015).
Calhoun discussed the inequity of tariffs/duties in his final speech, the one he had to have Virginia senator James Mason else read for him.

http://blueandgraytrail.com/event/Speech_by_John_C._Calhoun,_March_4,_1850
The next is the system of revenue and disbursements which has been adopted by the government. It is well known that the government has derived its revenue mainly from duties on imports. I shall not undertake to show that such duties must necessarily fall mainly on the exporting States, and that the South, as the great exporting portion of the Union, has in reality paid vastly more than her due proportion of the revenue; because I deem it unnecessary, as the subject has on so many occasions been fully discussed. Nor shall I, for the same reason, undertake to show that a far greater portion of the revenue has been disbursed in the North, than its due share; and that the joint effect of these causes has been to transfer a vast amount from South to North, which, under an equal system of revenue and disbursements, would not have been lost to her. If to this be added that many of the duties were imposed, not for revenue but for protection--that is, intended to put money, not in the Treasury, but directly into the pocket of the manufacturers--some conception may be formed of the immense amount which in the long course of sixty years has been transferred from South to North. There are no data by which it can be estimated with any certainty; but it is safe to say that it amounts to hundreds of millions of dollars. Under the most moderate estimate it would be sufficient to add greatly to the wealthy of the North, and thus greatl and not the reasony increase her population by attracting immigration from all quarters to that section.​

And yet, didn't Calhoun say that the tariff was the occasion but not the reason for the South's distress?
 

unionblue

Brev. Brig. Gen'l
Member of the Year
Joined
Feb 20, 2005
Location
Ocala, FL (as of December, 2015).
From the book, The Road To Disunion: Secessionists at Bay, 1776-1854, by William W. Freehling, chapter 15, The First Confrontation Crisis, II: South Carolina versus the South, pg. 284-285:

"...Final terms of the Calhoun-Clay compromise revealed that Clay had compromised protectionism only in the distant future. The bill left 50% rates unchanged throughout 1833. On the first day of 1834, duties in excess of 20% would be lowered one-tenth of the excess (not, let it be noted, the larger reduction of one-tenth of the whole rate). That new rate of 47% would prevail throughout 1834 and 1835. Similar one-tenth reductions of the excess over 20% would take place biannually, making the rate 44% in 1836 and 1837, 41% in 1838 and 1839, and 38% in 1840 and 1841. Finally and at long last ten years hence, in two big cuts at the beginning and in the middle of 1842, rates would be sliced to 20%--where the Jackson administration's Verplanck's Bill would have them in two years!"

...The July 1, 1842, reduction to 20% would not last out the year. A Whig majority, in the Tariff of 1842, would hoist rates back up to the 35% level. Henry Clay, the Great Compromiser, had compromised protection remarkably little."

Clay compromised not at all on a matter Calhoun considered vital: the constitutionality of protection. Carolina went to the brink to secure not just low tariffs but the principle that any general welfare legislation, whether protection of industries or the colonization of blacks, was unconstitutional. But constitutional laws cannot be legally enforced for ten years. Clay's "compromise," by reinforcing the general welfare legislation for a decade, nullified Nullifiers' larger constitutional purposes.

If constitutionally Calhoun had secured nothing, economically he had perpetuated the highest tariffs ever to be charged in antebellum America, throughout the worst cotton depression his constituents would ever suffer
. Carolinians had breathed defiance partly because the tariff robbed them, so they thought, of 40 bales per 100. Such thievery, so they believed, would imminently sap their resistance by demolishing their finances. For nine more year, in the settlement bearing Calhoun's stamp of approval, the robbery would continue at or above the Forty Bale rate, while cotton prices would remain debilitatingly low..."

What Calhoun said in 1850 does not match his actions in previous years. Seems more like Calhoun was practicing CYA for his own legacy.

Unionblue
 

Philip Leigh

formerly Harvey Johnson
Joined
Oct 22, 2014
Calhoun discussed the inequity of tariffs/duties in his final speech, the one he had to have Virginia senator James Mason else read for him.

http://blueandgraytrail.com/event/Speech_by_John_C._Calhoun,_March_4,_1850
The next is the system of revenue and disbursements which has been adopted by the government. It is well known that the government has derived its revenue mainly from duties on imports. I shall not undertake to show that such duties must necessarily fall mainly on the exporting States, and that the South, as the great exporting portion of the Union, has in reality paid vastly more than her due proportion of the revenue; because I deem it unnecessary, as the subject has on so many occasions been fully discussed. Nor shall I, for the same reason, undertake to show that a far greater portion of the revenue has been disbursed in the North, than its due share; and that the joint effect of these causes has been to transfer a vast amount from South to North, which, under an equal system of revenue and disbursements, would not have been lost to her. If to this be added that many of the duties were imposed, not for revenue but for protection--that is, intended to put money, not in the Treasury, but directly into the pocket of the manufacturers--some conception may be formed of the immense amount which in the long course of sixty years has been transferred from South to North. There are no data by which it can be estimated with any certainty; but it is safe to say that it amounts to hundreds of millions of dollars. Under the most moderate estimate it would be sufficient to add greatly to the wealthy of the North, and thus greatly increase her population by attracting immigration from all quarters to that section.​
Calhoun also put it more succinctly: "We export to import."

Without Southern exports America could not generate the exchange credits needed to pay for imports. Without imports, there would be no tariff revenue. Without tariff revenue, 90% of the funding used to operate America's antebellum Federal government would vanish. Instead it would have to be supported with "internal" taxes, which were highly unpopular.
 
Last edited:

CSA Today

Brev. Brig. Gen'l
Honored Fallen Comrade
Joined
Dec 3, 2011
Location
Laurinburg NC
How would Calhoun know what happened after the CW when he died in 1850? He lived during the decades when tariffs were low and when it actually decreased the GDP. The raising of the tariffs actually increased the US economy by 3%. This proves that cotton exports were always expendable and were fungible.

From 1800-1870, the United States ran a trade deficit for all but three years and the trade balance averaged about –2.2 percent of GDP. Then from 1870-1970, it ran persistent trade surpluses that averaged about 1.1 percent of GDP. Therefore, low tariffs catering to cotton exports actually hurt the nation economically. Placating southern plantation owners caused the US to operate in the red. Once the placating was lifted the U.S. operated in the black.

Therefore, the south's economical woes following the CW were due to people like Calhoun who wanted to remain primitive, and refused to see the big picture.


View attachment 354218
From the pen of an esteemed historian who is still alive:

"Fundamental to these conflicts was a basic regional division in the American economy. The South produced the immense majority of foreign exports—tobacco, cotton, rice, sugar—without which there could have been no foreign trade. Part of the Northern economy was mercantile—involved with the carrying trade in Southern products. But after the War of 1812, the Northern economy was increasingly industrialised as an outlet for surplus capital and population. That economy could produce nothing that was not produced by the more advanced British industry. Northern industrialists thought they needed tariffs (taxes) on imports so that the price of British goods would be raised and Northern goods could be sold at great profit for just a little less than the taxed imports. This was presented as the “American System,” a boon to the whole country, purportedly increasing the wealth and strength of the “nation.”

Thoughtful Southerners quickly perceived that the tariff forced them to pay higher than market prices for manufactured goods and, by discouraging reciprocal trade, depressed the European market for Southern produce. Why should Northerners sell their products in a home market artificially protected by the government, while the price of cotton, on which so much of the national economy depended, was decided in a completely open world market over which the producers had no control? “Why should the government pay the expenses of one set of men and not of another?,” asked John C. Calhoun. He further pointed out that the benefits of the “American System” went entirely to the wealthy class of the North and not to Americans in general. Besides, the Constitution allowed the federal government to levy tariffs in order to support itself, not to provide unconstitutional favours to some people at the expense of others.3

New Englanders, with their customary arrogance, attempted to disguise their greed by claiming that the South was poor and backward, low prices for its products being due entirely to its own laziness and ignorance. This absurdity has been repeated endlessly by historians. In fact, the South was prosperous and produced the greater part of the wealth of the country. Southerners did not go in for industry in a big way because their agricultural life was more profitable and congenial. The most important innovation of the pre-war period, the McCormick reaper, though manufactured in the Midwest where it was needed, was invented by a Southerner, as were other important items. Through the leadership of scientific farmers like Edmund Ruffin, the worn-out lands of the older Southern States had been restored to productivity before The War. When it became necessary to repel invasion, Confederate scientists and engineers, professional and amateur, performed miracles of industrial production and technological innovation. The “backwardness” of the South was entirely in the eye of the hostile beholder."

Those People Part 2
https://www.abbevilleinstitute.org/clyde-wilson-library/those-people-part-2/
 

unionblue

Brev. Brig. Gen'l
Member of the Year
Joined
Feb 20, 2005
Location
Ocala, FL (as of December, 2015).
Calhoun also put it more succinctly: "We export to import."

Without Southern exports America could not generate the exchange credits needed to pay for imports. Without imports, there would be no tariff revenue. Without tariff revenue, 90% of the funding used to operate America's antebellum Federal government would vanish. Instead it would have to be supported with "internal" taxes, which were highly unpopular.

Calhoun was wrong.

Why didn't the antebellum Federal government vanish during the Civil War when internal taxes were instituted?

Because confidence in "King Cotton" was badly overrated.
 

unionblue

Brev. Brig. Gen'l
Member of the Year
Joined
Feb 20, 2005
Location
Ocala, FL (as of December, 2015).
Not by the Yankee speculators trying to get it by hook or crook in Federal occupied areas of the CS.

But it was thought of as a trump card by Confederate politicians, who tried to blackmail England and France into supporting the Confederacy.

Point is, the federal government didn't vanish because trade with the South stopped, so this theory is suspect.
 

CSA Today

Brev. Brig. Gen'l
Honored Fallen Comrade
Joined
Dec 3, 2011
Location
Laurinburg NC
But it was thought of as a trump card by Confederate politicians, who tried to blackmail England and France into supporting the Confederacy.

Point is, the federal government didn't vanish because trade with the South stopped, so this theory is suspect.
Neither Dr. Wilson nor anybody else I'm aware of ever implied the federal government vanished.
 

Philip Leigh

formerly Harvey Johnson
Joined
Oct 22, 2014
Calhoun was wrong.

Why didn't the antebellum Federal government vanish during the Civil War when internal taxes were instituted?

Because confidence in "King Cotton" was badly overrated.


Not by the Yankee speculators trying to get it by hook or crook in Federal occupied areas of the CS.

Actually, between 1861 and 1865 inclusive the Federal Union had a cumulative trade deficit of $356 million which amounted to more than 25% of its exports during the same period. They paid for it with borrowings, which is an imprudent long-term strategy.
 
Last edited:

unionblue

Brev. Brig. Gen'l
Member of the Year
Joined
Feb 20, 2005
Location
Ocala, FL (as of December, 2015).
Neither Dr. Wilson nor anybody else I'm aware of ever implied the federal government vanished.
Calhoun also put it more succinctly: "We export to import."

Without Southern exports America could not generate the exchange credits needed to pay for imports. Without imports, there would be no tariff revenue. Without tariff revenue, 90% of the funding used to operate America's antebellum Federal government would vanish. Instead it would have to be supported with "internal" taxes, which were highly unpopular.

Just so you know.

Unionbluer
 

lurid

First Sergeant
Joined
Jan 3, 2019
Calhoun was wrong.

Why didn't the antebellum Federal government vanish during the Civil War when internal taxes were instituted?

Because confidence in "King Cotton" was badly overrated.

Calhoun was obviously suffering from dementia when he made that economic gaffe. He must have thought it was 1828 when it really was 1850. It appears, his proxy read his statements without any reservations either, even though tariffs were low in 1850. Goes to show the conceptive powers of the dynamics of economics were very finite back in that era. Consequently, nothing has changed in some sects.

The chart below shows that tariffs were low in 1850 and steadily lowered until 1860. Tariffs shot back up in the 1860s but Calhoun was deceased when tariffs were elevated, so he could never have made that determination.

Average_Tariff_Rates_in_USA_(1821-2016).png


There's a plethora of misconceptions of the economic impact cotton had on the USA's GDP, and it is grossly peddled. Two parties claim that cotton production built the United States of America: 1). white southerners. 2). black people. The former suggests that the north went to war because they wanted and needed the south's economic revenue from cotton exports and the latter agrees because it wants reparations for slavery. Both are unambiguously wrong.

The data clearly shows that cotton exports never exceeded above 5% of the national GDP.

cotton gdp.png


However, people do not understand how real GDP works. As a result, they regurgitate what inept historians claim and believe cotton exports were big part of the national GDP. Authors like, Ed Baptist from Cornell proceed to double and even triple count intermediate transactions involved in cotton production—things like land purchases for plantations, tools used for cotton production, transportation, insurance, and credit instruments used in each. Eventually that $77 million became $600 million in Baptist’s accounting, or almost half of the entire antebellum economy of the United States. That's absurd.

The calculation of GDP, the main formulation of national accounts and a representation of the dollar amount of economic activity in a country in a given year, only incorporates the value of final goods and services produced. The rationale for doing so comes from accounting, as the price of the final good already incorporates intermediate transactions that go into its production and distribution. They reflect a basic unfamiliarity with the meaning and definition of GDP.

Baptist’s empirics, observing that a continuation of his "faulty methodology" by summing the roles of cotton with a few other primary products would yield an amount that easily "exceed[ed] 100 percent" of GDP in the antebellum United States—an economic impossibility.

The evidence clearly show in real GDP cotton exports accounted for only 5%. Anyone can double and triple count intermediate transactions to inflate cotton's worth. But that's innumerate to basic accounting and an economic impossibility.

Therefore, you are correct when you said Calhoun was wrong and cotton was badly overrated.
 
Top