GU
Right on your 1st point I see two problems.
a) Your now talking about an independent CSA deciding to screw up trade with one of its most important markets simply for the sake of it. That makes no sense at all.
b) As the article you link to makes clear trade between the two sides was not greatly blocked during the war because elements on both sides benefited from it. This is going to continue to be the case after the war ended. How is the south going to enforce such a ban on exports to the north given both widespread corruption and their lack of any ability to control cotton exports once their on a ship. In the latter case a ship owner can simply sail north either directly to the union or if they want additional cover to Canada and as in the wartime 'Canadian' cotton is imported into the union.
I notice you comment from Mr Leigh speech excludes the paragraph immediately following what you post.
This will continue to be an issue for the south after the war ends, especially since the US is by far the largest and most regularly available source of agricultural imports.
The comments of one man is less important than the actions of tens of thousands of people. On that I stand by my previous statement. Yes if the south won independence that would certainly reduce somewhat commerce between the two nations but how much would depend on the details. I think the south deciding on some sort of bitter trade war with the north, which would hurt both sides hard highly unlikely however.
In terms of tariffs in the south post war yes there would be an impact on trade with the north in that European goods are often cheaper at this point. Although this may not be too significant for inland states, especially those close to the border as transport costs might do much to reduce that competitive advantage.
A lot would depend on what the tariff levels were, as you yourself reference different people saying different things. Also the proposed tariff you mention, from May 1861, which would be very expensive for the free population of the south - as you say
That is a considerable increase on the levels of tax on the southern population and is unlikely to be popular once the war is over. I suspect that there would be limited will to maintain it once the war is over.
There is always a balance with tariffs. Is the purpose to protect industries or to raise funds for the government as the two are contradictory to some degree. A very high tariff to largely stop imports totally will protect the industries - at a high cost to the home consumer - but since it will choke off imports will raise little money. A low one will raise more money but give relatively little tax revenue. Like you I have seen differing suggests on what levels of tariffs an independent CSA would apply but the general impression I have seen was that of their stated desire for lower tariffs to reduce the cost of imported good.
Also given the relatively limited scale of southern industry before the war would they be able to maintain a high general tariff on imported industrial goods without crippling their economy? The customer needs to be able to afford to buy the product and if the CSA insisted on a tariff wall as high as some of those suggestions then either they have to pay a high price to make it profitable for the foreign importer or they have to go without as the home producers can't, at least for a couple of years while new plants are built supply the home market.
The point was made originally because you suggested that in an eventual peace treaty, the North would seek to bisect the Confederacy via retaining control over the Mississippi; in such an eventuality, the C.S.A. would have every reason to conduct economic warfare as such borders would undermine it's entire existence. If the North does not do such, I see no reason for such economic warfare but such is the point: it depends on what the North does.
Given that in 1870, 60% of the South's cotton was exported to foreign markets anyway, it must be pointed out the North was not their main market, but Europe itself was.
The situation of the war era would not continue into the Post-War given the war itself was what engendered the situation. President Davis and the C.S. Government allowed the trade because it brought gold and weapons into the C.S.A. and thus helped to address in part their industrial imbalance in war goods with the North; why exactly would the C.S. continue to overlook such a trade given they have no need for arms now with peace? As already pointed out the C.S. had a more centralized and effective bureaucracy than the North with more Government agents too, so they have the ability to suppress any illegal trade. Further in this regard,
I'm not sure where the idea of corruption comes from, given we know how the C.S. conducted their tax regime and it was very effective. Given it's much easier to hide money and financial assets than loads of cotton that must be stored and transported, why exactly would the C.S. Bureaucracy fail in this specific instance?
Finally, as already pointed out multiple times now, the North was importing 40% of the South's production which equates to over 4 million bales of Cotton; such would be impossible to hide as it would require hundreds of ships, the full use of the C.S.A.'s railway network and quite literally tens of thousands if not hundreds of thousands of people to keep it quiet. This is simply not possible to hide and very quickly any scheme would be broken up by the Confederate Secret Service, which already had quite a few agents in the North IOTL.
With regards to Mr. Leigh's comments, I did not include them because that specific one is in error. The main crop in the South wasn't cotton, it was corn:
The Pre-Civil War South's Leading Crop, Corn by Donald L. Kemmerer,
Agricultural History, Vol. 23, No. 4 (Oct., 1949), pp. 236-239:
As can be seen from Table 1 the South produced more corn than the North in all three of these census years. On a per capita basis Southern supremacy in corn production was even more marked, for the North was the more populous region. The North's population was double that of the South in 1859. Nor should the fact be overlooked that corn was the leading grain crop of the Nation, being twice as important as wheat, rye, oats, barley, and buckwheat combined. When analyzed, the corn production figures for 1839, 1849, and 1859 all tell about the same story.
For the purposes at hand, therefore, it will suffice to examine one set. The middle year, 1849, has been selected because the figures are more complete than for 1839, and the year is not at the very end of the period under investigation, as 1859 is. Table 2 reveals that in 1849 the 15 Southern States and the District of Columbia produced about 60 percent of the Nation's corn crop. Of the 16 leading corn-producing States in the Nation, North and South, 11 were in the South. True, the leading corn States were in the North but so were most of the States with little corn production. The upper South more than the western North deserved to be called the Corn Belt. In 1839 the three leading corn States were Tennessee, Kentucky, and Virginia, and as a region the upper South always led the Midwest in corn production.
Table 3 shows that corn excelled cotton in the South not only in weight, which was to be expected, but also in acreage cultivated and in value, neither of which is usually realized. Whether the modest figure of 200 pounds of cotton to the acre is taken- that was the average in North Carolina and Alabama about 1905-or the more generous estimate of 530 pounds to the acre for the South by J. D. B. DeBow in 1852, corn acreage was several times greater than cotton acreage. Even if the worst possible yield for cotton per acre is compared to the best possible yield for corn, corn acreage exceeded that of cotton. The truth must be that the great fields of cotton made more impression on everyone than the numerous fields and plots of corn. The situation resembled that prevailing in the cattle industry after the Civil War when the Great Plains States were famous for their vast herds but actually had fewer cattle in the aggregate than all the Eastern farms. The Great Plains States did a smaller business on a grand scale whereas the many farms of the East conducted a larger business on a small scale.
With regards to New Jersey, again, to claim such is to make an apples to oranges comparison. Every man in New Jersey could've been a diehard abolitionist serving in the Union Army but that does not invalidate the specific point made, in that New Jersey (As an example) was dependent on the South for purchasing its manufactured goods. Nothing about the political concept of Unionism detracts from the point the Governor made, in that all of New Jersey's production going South must now pass through a tariff barrier and compete with European goods and Confederate goods on disfavorable rates. As you yourself noted, this means reduced output and the need to find new markets, which means mass unemployment and ruined State finances.
With regards to the tariff rates, again, this is not a matter of speculation as these were the rates actually passed and maintained throughout the entire existence of the Confederate States.
They were very popular politically and attempts to repeal them were continuously defeated in Congress, and after early 1862 no other efforts were made to revoke them according to
Confederate Finance by Robert Cecil Todd. I therefore see no reason to assume any adjustments or revocations of them, given the lack of any evidence of broad political support for such. The reasoning behind this is quite simple; the per capita burden obscures that most of the tax burden fell on the upper classes, which could afford such costs.
Now then, with regards to the issue of the level of the tariff, as already cited, these were the same rates the United States itself was under in the 1840s and 1850s. Given that did not undermine the industrialization of the North nor did it strangle international commerce, why exactly would it do so here to the Confederacy? As Robert C. Todd points out, in it's early days the Confederates were using exactly the same rates as the U.S. as a whole had been from 1857 until 1861. It seems incredulous to suggest it would not work for the South when it worked for the nation as a whole before. With regards to the issue of the tariff and internal transportation, please see this map:
This is taken from
The Iron and Steel Industry of the Birmingham, Alabama, District by Langdon White (
Economic Geography, Vol. 4, No. 4 (Oct., 1928), pp. 349-365). As the description notes, it specifically concerns the profitability of industrial goods from Alabama vs those from Pittsburgh and Chicago, i.e. the main steel centers of both respective sections of the nation. As noted by the map, Birmingham was more competitive than both in the overwhelming majority of the South. For those portions not covered, unlike in the historical 1920s, they would be behind a protective tariff barrier and thus we can safely assume that Birmingham too would have the advantage in such an eventuality. Why I bring this up is because the example is equally applicable to the issue of imports from Europe.
Finally, as already pointed out the U.S. prospered under the same tariff rates as the C.S.A. would be under but here too we find a Confederate advantage the U.S. as a whole didn't have in its own development. Unlike the Federal Government, the C.S. Government was very State Capitalist and willing to make large investments to meet its economic and geopolitical needs. To quote again from John Majewski, this time from the Chapter
ECONOMIC NATIONALISM AND THE GROWTH OF THE CONFEDERATE STATE:
Confederate railroad policy, in fact, provides a microcosm for understanding how secessionists crossed the thin line separating antebellum state activism and a powerful, dynamic Confederate state. On the face of it, most Confederate leaders seemingly opposed national railroads. During the Confederate constitutional convention, South Carolina’s Robert Barnwell Rhett and other secessionists sought to prohibit the central government from funding internal improvements. The Confederacy, they argued, should never allow internal improvements (at least on the national level) to generate the evils of logrolling, budget deficits, and higher taxes. Rhett won an important victory when the Confederate constitution specifically prohibited Congress from appropriating ‘‘money for any internal improvement intended to facilitate commerce.’’ The constitution allowed the Confederate Congress to appropriate money to aid coastal navigation, improve harbors, or clear rivers, but only if it taxed the commerce that benefited from such improvements. ‘‘Internal improvements, by appropriations from the treasury of the Confederate States,’’ Rhett’s Charleston Mercury cheered, ‘‘is therefore rooted out of the system of Government the Constitution establishes.’’
States’ rights ideology, though, eventually lost to a more expansive vision of the Confederate central state. As Table 6 shows, the Confederate government chartered and subsidized four important lines to improve the movement of troops and supplies. Loans and appropriations for these lines amounted to almost $3.5 million, a significant sum given that a severe shortage of iron and other supplies necessarily limited southern railroad building. Jefferson Davis, who strongly backed these national projects, argued that military necessity rather than commercial ambition motivated national investment in these lines. The constitutional prohibition of funding internal improvements ‘‘for commercial purposes’’ was thus irrelevant. That Davis took this position during the Civil War followed naturally from his position on national railroads in the antebellum era. Like Wigfall, he believed that military necessity justified national railroad investment. As a U.S. senator, Davis told his colleagues in 1859 that a Pacific railroad ‘‘is to be absolutely necessary in time of war, and hence within the Constitutional power of the General Government.’’ Davis was more right than he realized. When the Republican-controlled Congress heavily subsidized the nation’s first transcontinental railroad in 1862, military considerations constituted a key justification. Even after the Civil War, the military considered the transcontinental railroad as an essential tool for subjugating the Sioux and other Native Americans resisting western settlement.
When the Confederate Congress endorsed Davis’s position on railroads, outraged supporters of states’ rights strongly objected. Their petition against national railroads—inserted into the official record of the Confederate Congress—argued that the railroads in question might well have military value, ‘‘but the same may be said of any other road within our limits, great or small.’’ The constitutional prohibition against national internal improvements, the petition recognized, was essentially worthless if the ‘‘military value’’ argument carried the day. Essentially giving the Confederate government a means of avoiding almost any constitutional restrictions, the ‘‘military value’’ doctrine threatened to become the Confederacy’s version of the ‘‘general welfare’’ clause that had done so much to justify the growth of government in the old Union. The elastic nature of ‘‘military value,’’ however, hardly bothered the vast majority of representatives in the Confederate Congress. The bills for the railroad lines passed overwhelmingly in 1862 and 1863. As political scientist Richard Franklin Bensel has argued, the constitutional limitations on the Confederate central government ‘‘turned out to be little more than cosmetic adornments.’’
Like Louis Wigfall’s rambling interview with William Howard Russell, the ‘‘cosmetic adornments’’ in the Confederate constitution allowed secessionists to articulate republican principles without actually having to follow them. If Confederate delegates in Montgomery really wanted to stop all national improvements, they could have simply prohibited the Confederate Congress from appropriating ‘‘money for any internal improvements’’ rather than insert the qualifying phrase ‘‘intended to facilitate commerce.’’ It is hard to believe that the inclusion of the ‘‘commerce’’ qualification was accidental. Having spent much of their careers debating the old federal Constitution, the delegates at Montgomery carefully considered the implications of every phrase they wrote.∞∂ The delegates surely knew that men such as Wigfall and Davis had used the national defense argument to justify federal spending on internal improvements. As it was, the delegates ritualistically invoked states’ rights without having to worry about the consequences. Historian Don E. Fehrenbacher has argued that the Confederate constitution was written ‘‘by men committed to the principle of states’ rights but addicted, in many instances, to the exercise of national power.’'Perhaps it would be more accurate to say that Confederates were committed to the language of states’ rights in a way that rarely prevented the growth of national power.
The decision to subsidize railroads, while ideologically important, was only a small part of the overall growth of the Confederate state. Other elements of Confederate state building, in fact, proved less controversial. When a shortage of pig iron threatened ordnance production, Davis told Congress in early 1862 that the ‘‘exigency is believed to be such as to require the aid of the Government.’ In April 1862 the Confederate Congress passed legislation that offered no-interest loans to iron masters who expanded their forges. The loans would only pay half the cost of the additional investment, but the Confederate government also covered to make advances up to one-third the value of contracts. To help forges secure additional raw materials, the Confederate Congress set up the Niter Bureau in 1862, which quickly became involved in exploration for new sources of iron. The Confederacy sometimes used private firms to produce ordnance—the famous Tredegar Iron Works is a good example— but the Confederacy’s Ordnance Bureau also built and operated its own arsenals, mills, and factories throughout the South. The arsenal at Selma, Alabama, for example, employed 3,000 civilians, while the Ordnance Bureau’s powder factory in Augusta, Georgia, was the second largest in the world. Whereas the North tended to rely on government contracts with private firms to meet the needs of wartime production, the Confederacy, with surprisingly little opposition, produced much of the military supplies consumed by its armies.
The story of the Quartermaster Department is similar to the Ordnance Bureau. Historian Harold S. Wilson describes Confederate e√orts to outfit soldiers with uniforms, shoes, blankets, and tents as the ‘‘brink of military socialism.’’ The Quartermaster Department of the Confederacy operated its own factories and workshops, employing some 50,000 workers (many of them seamstresses). To obtain cloth for these factories and workshops, the Quartermaster Department exerted immense control over privately owned textile mills. Mills that refused to submit to Confederate controls on prices and profits faced the prospect of having their workers conscripted into the Confederate army. When wool supplies ran short—largely because Union forces captured most of the major woolproducing areas early in the war—the Confederate Congress authorized quartermasters to impress whatever supplies they could find. The Confederate Congress also allowed the Quartermaster Department (under the auspices of the Bureau of Foreign Supplies) to regulate and control most blockade runners. In early 1864 the Confederate government prohibited private shipments of cotton, tobacco, and other staple crops; required that private blockade runners devote half of all cargo space to the war department; and prohibited luxuries from entering the South. The Confederacy had essentially nationalized much of its foreign commerce.