Discussion in 'Civil War History - Secession and Politics' started by Hunter, Mar 1, 2017.
I believe the answer is,cotton..
Not in the United States. It is not counstutional to place tarrifs on exports.
But OK to tax exports under the CSA Constitution.
How did that work out? A smuggler would buy cotton for at best pennies on the dollar since the smuggler has a ten percent average chance of being intercepted. Plus the smuggler has to pay to load and unload the cotton before reaching a large cargo ship in a Caribbean port. Plus a blockade runner would use a lot of fuel.
I would think with all that more often the not Uncle Davis would get shortchanged.
The luckiest Confederate growers wpuld just sell their cotton to Northern cotton brokers or yes even the U.S. Navy on the down low.
I don't think so. Exports were not taxed. The threat of retaliatory taxation by foreign importers of cotton whose exports were taxed by the U.S. was a legitimate concern in the South, however.
I am not a scholar. This needs to be explained. U.S. presidents have unilaterally embargoed trade with foreign governments by executive order. How is it unconstitutional to levy tariffs and how did the CSA Constitution allow it?
Article I section 8
The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;
Article I section 9
No Tax or Duty shall be laid on Articles exported from any State.
However the CS Constitution changed this clause to:
No tax or duty shall be laid on articles exported from any State, except by a vote of two-thirds of both Houses.
In Feb 1861 the CS levied an export tax of 1/8 cents per pound on cotton.
In Feb 1863 the export tax on cotton was set 40 cents per pound on cotton and 25 cents per pound on tobacco.
Interestingly, your source contains the following:
CHAP. LV.--An Act to prohibit the exhortation (sic) of cotton from the Confederate States, except through the seaports of said States; and to punish persons offending therein.
Looks like they may have been trying to curb trading in cotton with the overland enemy. Didn't work out for Grant very well, either.
Of course by 40 cents we are talking 40 Confederate cents which by 1863 one would think a British pound could buy a whole lot of Confederate cents. Did CSA money even do thatmuch good for the CSA govt?
Confederate finance was a disaster. But I do think they understood that their tariff would not generate much revenue, and that's why they allowed the export taxes.
Prohibiting lucrative commodities never seems to work out. Law Enforcement often worked hand in glove with organized crime during Prohibition and sadly enough at least from the 1960s on in the case of illegal drugs. It hardly seems fair to blame Grant for a similar failure during the Civil War trying to prevent the sale of Confederate cotton to Union cotton brokers.
I think we have a whole thread about this and do not need to rehash the topic of trading with the enemy here.
Your statement is true Drew but I found graph fascinating in showing how the farming of cotton has 'migrated' over the past 200 years.
These were areas of level topography and great plantations where cotton could be grown at a cost of five cents in the mid–1850s, when the staple brought 11 cents at New Orleans.
Before the war ten cents a pound was thought to be the minimium price at which it was profitable to raise cotton [selling price ?].
i read a period letter that i can't find now from a person describing the new mississippi and alabama states and commenting that cotton could be produced at 5 cents per pound and anything over that was profit.
Alright, I don't know that I agree with this, but let's look at it. A reasonable yield from good cotton land in a typical year was probably 500 pounds per acre. Five hundred times six cents per pound, profit, is thirty dollars per acre.
To give some kind of modern perspective, the dirty rule of thumb is to multiply this by twenty. So, in today's terms, planters could earn a profit of $600 per acre, growing cotton. That's huge.
If six cents is correct (and I have my doubts), do the math. A farmer with 100 acres could make $60,000 in today's money. Not bad.
A planter with 1,000 acres in cultivation made $600,000 profit per year, in today's money. Do we really need to wonder about how well these guys were doing?
I appreciate everyone's input on this question, but until someone actually studies this in a systematic way and determines the average cost of production, determinining average profitability (or loss) is sheer guesswork. Right now it appears we only have anecdotal evidence.
We've said, over six pages, you won't ever find "the average cost of production." There are too many variables, applicable to individual producers. I'm not sure why this is difficult to grasp.
I agree with the futility of determining average cost. IMHO it is impossible to determine as described in the OP.
in my research the price of production is between 4 and 6 cents a pound. these costs seem to be relatively consistent through the 30s 40s and 50s. the difference is mainly the cost of slaves and land. newcomers probably had a higher cost of production than established planters but even this is balanced by the quality of old soil vs virgin soil.
the op wants a specific number and that seems to average between 4 and 6 cents. the op further asks , "is it profitable" ? that is a different question altogether. a planter may fail even if he stays within the production cost parameter.
the op seems to ask , if a man becomes a cotton planter and uses the established production model will he always make a profit ? no, farming has never worked that way.
in the previous pages i believe the profit potential has been demonstrated but greed, over speculation, weather, the economy, plantation mismanagement, bugs, and many other things all contribute to defeat the planter.
i was thinking of an analogy with the california or alaska gold rushes. some folks efforts paid off toiling in the mines, others worked just as hard an lost everything they had. the people who made money in either case were the outfitters, barkeeps, hotels, restaurants , and brothels. the same might be said of at least some of the cotton growers, even in their failure someone down the line was probably making money off of their cotton enterprise.
Sorry I am so dense. We "won't ever find " the average cost, or no one has tried to find it beyond anecdotal evidence? "There are too many variables," but does that mean they cannot be identified, studied, and controlled for? Is it because the data does not exist, or because economic historians have not chosen to spend the time to find and analyze it? Can't historians study 1000 or more plantations in a particular state? Has anyone tried?
If you google "cotton production costs and returns, United States," you will find that the average cost of production during modern times has been determined, so it is not impossible. If one claims that plantation cotton agriculture was "profitable," meaning revenues exceeding the cost of production, during the antebellum period, doesn't that necessarily assume that the costs for that period have been determined? If not, I simply submit that the hypothesis that it was profitable has not yet been proven.
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