The Economics of the Civil War

LewRockwell.com ^ | January 13, 2004 | Mark Thornton and Robert Ekelund

[PeaRidge]

Description of Appeal to Ridicule

The Appeal to Ridicule is a fallacy in which ridicule or mockery is substituted for evidence in an "argument."

[PeaRidge]

I think that there was something about this on this morning. I will see if I can find the transcript.

[PeaRidge]

I found it.

Sunday Morning Talking Heads Foxx News Show Interviews Lincoln Cabinet Officials


Today’s guests are the Lincoln Administration’s Secretary of the Treasury, and Secretary of State discussing the financial crisis known as SOUTHRON.

Tony Slow: Good Morning from Washington. The usual Foxx team is here, and this morning's guests are Treasury Secretary Salmon P. Chase and Secretary of State William Seward. Good morning gentlemen.

Mr. Seward and Mr. Chase: Good morning.

Tony Slow: As you know, the fleet of US warships that Mr. Lincoln sent to Charleston two weeks ago has just docked back in New York, having been unsuccessful in their attempt to land at Fort Sumter. The Confederate troops in Charleston took the fort, and thereby stopped a military invasion. However, Mr. Lincoln has just ordered 75,000 Federal troops called up, and is going about to blockade Southern ports. Sounds like he is declaring war. What's up with that?

Secretary Chase: Well, Tony, since the beginning of Mr. Lincoln's term I have consistently advised him that the seceding Southern states cannot be allowed to function independent of the US government.

Brit Humme: Why not? They have voted to be independent, and the peoples’ right to be free is guaranteed under our constitution and is now guaranteed under their new constitution. The Union is functioning nicely, so why do we need them?

Secretary Seward: Well, it is a bit more complicated than that Brit. Mr. Lincoln's actions have nothing to do with constitutional guarantees. It is much more than that.

Brit Humme: More than the Constitutional guarantees and the Bill of Rights? What could possibly be more important than the civil protections of the Constitution?

Mara Lieasson: Yes, it has to do with the freeing of the enslaved masses of Negroes from the chains of bondage on those massive plantations owned by those rich, lazy Colonel Sanders' of the South.

Mr. Seward: Sorry Mara, but Mr. Lincoln does not care about slavery. You remember, he just signed the Corwin amendment, the 13th Amendment to the Constitution, which will now guarantee that slavery will continue to legally exist and be legal in all states. It was just passed by both the House and Senate last month; he signed it, and it is now out to the states to be ratified.

Mara Liesson: I have never heard of that amendment. I am going to call Doris Kearnes Goodhead on my cell phone and get the truth.

Jarold Reverso: But in a speech he said that the country could not exist half slave, half free.

Mr. Seward: Jarold, he misspoke. What he meant to say was that the country could not exist 23% slave and 77% free. And where he came up with that idea, we don’t know. You know how he speaks…..in circles. He has come to believe that ambiguity seems to increase his political appeal.

Mr. Humme: He also said that he would not bring war, but would protect the revenue by collecting the tariffs. Sounds like that circular talk again. Is that why he sent the ships and troops to Charleston, and why is that not bringing war to the South?

Mr. Chase: Yes, Brit. That is exactly right. As you know, from the very first Cabinet meeting, I have been in favor of holding Charleston. In fact, I was the only person besides Lincoln who wanted to use the US military to coerce these people into paying the taxes. Mr. Lincoln thinks if he does not use the word "war", he can't be blamed for one if it happens. You can't argue with that logic.

Jarold Reverso: But why do we need these people, Mr. Chase? There is nothing down there except a bunch of rednecks, slaves, and Colonel Sanders’ effete snobs. They’re poor. They have nothing.

Mr. Chase: Jarold, let me see if I can explain it to you simply. Every year, hundreds of millions of dollars worth of tobacco and cotton are grown, harvested, sent to Southern ports and either direct shipped to Europe or sent through Philadelphia, New York, or Boston to their trading partners across the Atlantic. The profits from the sale of the goods are used to buy any number of other goods, which are then shipped back. When they reach our shores, the government has the right to tax the goods, which we do. The amount of taxes involved here is massive.

Mr. Slow: So, every year, the goods go back and forth and the government gets taxes on the transactions. No effort, just millions in taxes.

Mr. Chase: Yes, Tony, but not just millions. Here's the secret. Last year, 1860, it took only $31 million to run the entire government of the US. That was to pay for the Army, Navy, operations of the government, interest on public debt, government military pensions, and benefits. Guess how much we took in from tariffs?

Jarold Reverso: Tell us!

Mr. Chase: Well, we took in $53 million from tariffs; you must realize that 97% of the entire revenue of the treasury came from tariffs.

Jarold Reverso: I don't understand what this has to do with Colonel Sanders and Charleston.

Mr. Chase: Last year 65% of the tariffs raised were from tariffs on the imports of European goods purchased with the profits from the sale of Southern exports. So Jarold, duh, if the cotton and tobacco states leave the union, along with their cotton and tobacco financed imports which will be sold directly to Europe, the treasury would take in about 1/3 of what it did last year.

As of this morning, we only have enough in the treasury to run the government for about 2 months. Because of the recession in the North the past 3 years, our financiers in Europe and the Northeast are charging 12% to buy our Treasury notes, double the ordinary rates, and requiring the pledge of government owned land as collateral, something that is unprecedented. They have told us that they will not finance the government if it has no source of revenue.

Brit Humme: So, without tariffs, the government is broke!

Jarold Reverso: But Mr. Chase, you said that it only took $37 million to run the government. Why do you need over $50 million? Where is it all going?

Mr. Seward: Look Jarold. We have all sorts of industrial manufacturing that needs support. We are giving away land to the railroads. We are building roads, canals, docks, and water systems. Think infrastructure for Northern manufacturing. Congress determines all the spending beyond ordinary governmental basics recommended by the President. They all have their special spending requirements, and it would be impossible to stop them. Buchanan and his secretary of the treasury, Howell Cobb, tried their best to curb spending, but Congress went on record spending sprees the last couple of years, in spite of the recession.

Brit Humme: So, Southern dominated trade that produces the tariffs that finance the government, and thus Northern infrastructure spending that about doubles the cost of the government, is what Mr. Lincoln is wanting to preserve.

Mr. Seward: That is it in a nutshell.

Jarold Reverso: Is that what he meant when he said he would preserve the Union?

Mr. Seward: That was his public statement to appease and encourage Northern financial backers of the Government, industrialists, and politicians. It also served to rally political support from the uninformed masses.

Brit Humme: And he would take us to the brink of war to do so?

Mr. Seward: Yes. All we need is some excuse to attack. They have to take any coercion attempt on our part seriously because they have to protect and defend their new found independence. If they do not defend themselves, they have no chance to receive support from any other country.

---

Mara Liesson: (Dialing cell phone and whispering). Doris, what is this Corwin amendment deal?

Doris Kearnes Goodhead: Never read that in any of my books. Would really be bad for Lincoln and the Republicans if that were true. Worse even for us historians.

Mara Liesson: Yeah, there goes the entire “for the slaves” thing from the history books.

Doris Kearnes Goodhead: Well, they fired on the flag in Charleston…..that works well with the ‘kick-ass’ crowd.

Mara Liesson: Did you ever get Ken Burns straight on those starving troops at Fort Sumter story?

Doris Kearnes Goodhead: He said he read it in a paperback, and that maybe we should tone it down.

Mara Liesson: Doris, I think we ought to drop that story.

Doris Kearnes Goodwin: Could we just say that they were reduced to eating stale biscuits and pork? That's still pretty bad, isn't it? Yes, they were starving for lack of fresh oysters on the half-shell, and peaches with cream.

---

Tony Slow: That is a financial shell game of monumental proportions.

Mr. Seward: Yes, it is. I call it SOUTHRON.

Jarold Reverso: None of this is true. The South was poor, and the Northern economy was growing rapidly.

Mr. Chase: Not exactly son. The last 3 years in the North, it’s been pretty rough. It began with the Ohio Life Insurance and Trust Company, which declared in August of 1857 that it could no longer meet its obligations. This was important because it was the largest bank in Ohio, and purveyor of eastern credit and hard currency to the west. Its failure jarred the national banking system.

The next month, one of the largest banks in Philadelphia, alarmed by the drains on its reserves, suspended specie payments. Most northern banks reacted by hoarding reserves and tightening credit. Soon, many banks in the North began to close. Demand for overseas goods dropped, and soon northern exports dwindled. All the while in the South, the tobacco and cotton business was booming, with record exports and profits for the agricultural section of the country.

Tony Slow: Then there was the panic in 1859 with more banks closing and the Federal government still spending over $69 million while taking in only around $50. The Treasury borrowed $20 million to keep Congressional spending financed.

Brit Humme: With no recession in the South, their imports increased to become 66% of the value of the entire overseas commerce of the US.

Jarold Reverso: And Mr. Lincoln knows this? What a guy! And he sent the ships and troops to Charleston to make sure we will have our tax money. YES! He will go down in history as our greatest President.

Brit Humme: Only one thing here Jarold. The people of the South will defend their society. How many will Lincoln have to kill to preserve the financial house of cards that rests on the tariff system?

Jarold Reverso: But they fired on our flag at Ft. Sumter. That gives us the right to do anything to them. I am sure that there is some law that says that.

Mara Liesson: (leaning over to Jarold, whispering) Don’t use the starving soldiers story.

Mr. Seward: That was the political genius of Lincoln. He put a former, retired naval officer that had no current military authority, aboard a large fleet of federal ships with ambiguous orders to go to Charleston where another lower level officer, in charge of the fort who also had ambiguous orders, and waited to see what would happen.

Jarold Reverso: What a comedian. He threw them in and let 'God sort it out'. Hmmm. Idea for a T-shirt?

Brit Humme: Not exactly, but might be a good subject for a future speech. The Confederacy rightly defended its Declaration of Independence from the Union by defending Fort Sumter. The fort was taken without loss of life, the Federal invasion was stopped, and all Union forces from the fort were peacefully returned to the commander of the invading fleet.

Tony Slow: Apparently the real threat was Lincoln's usurpation of power. He thus became the first US President to send Federal troops out to violently attempt to solve a political problem of the people. He also inaugurated the practice of making war on citizens instead of armies.

Mara Liesson: You are being too dramatic Tomy. Lincoln is going to save the Union!

Brit Humme: Stuff it Mara. You have been hanging around with Doris too much. He is going to save the flow of money that allows Northern Industrialization to continue at the expense of the South.

Mara Liesson: You are insinuating that the North was being funded by slavery, and that the government was benefiting from slave labor the same as Southern farmers. How outrageous! Nothing of the kind was occurring.

Brit Humme: Have it your way, Mara. Sounds like you have got your panties in a bunch.

Tony Slow: The only question is how many lives will have to be given to protect the government-big business morass.

Mr. Seward: Judging from his determination to protect SOUTHRON, I would say it does not matter to him.

Jarold Reverso: Shocking.

Mara Liesson: Oh, eat one Jarold.

[PistolPaknMama]

That is priceless! THANK YOU!!! LOL.

[GOPcapitalist]

He was refuting a poster's claim of non-bias, by pointing out no criticism of the Davis regime accompanied that of Lincoln's.

...which again leads directly to my point. What rule says that every criticism of Abe Lincoln must be accompanied by a criticism of Jeff Davis no matter how unrelated Davis may be to the conversation? That sort of nonsensical belief is the substance from which tu quoques are born.

[GOPcapitalist]

The definition's still the same it has always been. Unfortunately for your case you never understood that seemingly simple definition the first time and apparently still don't get it. You can lead a donkey to water...

[GOPcapitalist]

I don't see anything there either to suggest that a large number of people thought in 1861 that the war would be a long one.

The original question was not long war/short war. It was war/no war and if Congress would be reconvened in the event of war.

As I stated earlier: "And as you well know, many in Congress rightfully believed that war was just around the corner and expected without any reason for doubt that they would be immediately reconvened if it broke out while they were away."

You asked for documentation of that fact. So I directed you to the special session of the senate in March 1861, where the issue of keeping congress informed of any military activities and reconvening it in the event of war came up on a regular basis.

[mac_truck]

From the article:

"Historians often have argued that the Confederacy lost because it was overly reluctant to use government power and economic controls, but we show the exact opposite. Big Confederate government brought the Confederacy to its knees. "

[gopcap] What rule says that every criticism of Abe Lincoln must be accompanied by a criticism of Jeff Davis no matter how unrelated Davis may be to the conversation?

A better question might be why you think Jefferson Davis is unrelated to a conversation about Big Confederate Goverment?

[GOPcapitalist]

A better question might be why you think Jefferson Davis is unrelated to a conversation about Big Confederate Goverment?

I never stated that he was unrelated to this article. I did observe that he was unrelated to the Lincoln criticisms offered by others on this thread thus rendering Non-Seq's tu quoque insistence upon an equal and opposite Davis criticism to accompany each Lincoln criticism an absurd device in itself.

[GOPcapitalist]

He believes in those old sothron traditions.

Since when is accurately referring to a juvenile's antics for the purpose of highlighting that they are in themselves juvenile an exclusively southern tradition? Any competant, sane, and reasonable educated individual could easily take one look at your tu quoque antics and conclude them to exhibit the characteristics of a juvenile, thus prompting a reference to you as "boy" (or, in the case that you happened to be female, "girl"). It matters not what region they come from as the tu quoque tactic you use is childish in itself.

[Non-Sequitur]

(*sigh*) Do I really have to define 'sarcasm' to you?

[Non-Sequitur]

Substituting ridicule or mockery for evidence again I see. And this is your "argument?" Pretty lame, Pea. Even for you.

[Non-Sequitur]

What rule says that every criticism of Abe Lincoln must be accompanied by a criticism of Jeff Davis no matter how unrelated Davis may be to the conversation? That sort of nonsensical belief is the substance from which tu quoques are born.

According to any one of your half-dozen definitions of the term, no doubt.

[Non-Sequitur]

You can lead a donkey to water...

When it comes to imitating a jackass I'll defer to your expertise in the matter.

[Non-Sequitur]

It matters not what region they come from as the tu quoque tactic you use is childish in itself.

Yassuh, boss.

[4CJ]

ROTFL!

[CIBGUY]

It was pure and unadulterated hypocrisy on the part of Lincoln. There is no rationale to his thoughts other than attempting to exploit the issue of slavery in those States that had already left the Union. Read Lincoln's quotes regarding slavery and its relationship to the Union wherein he specifically states the "If the Union could be preserved with slavery, I would accept slavery." His real concern was the preservation of the Union, slavery was simply not the main issue. Actually, the Confederacy was a real threat to the northern states simply because their financial investments in the South were jeopardized by secession. Secession would have removed the northern investors from the international bargaining table. The Confederacy would have established its own tariff rates, their own export and import laws, and their own monetary rate of exchange. The South had many supporters in Europe including both Britain and France, both of whom would have profitted from an independent South. Linclon was in fear that the dissolution of the Union would create too tempting a target for European interests, especially in the West and South. Yes, the "War of the Rebellion" better known in the South as the "War for Southern Independence" is a fascinating subject, especially if one takes the time to research the "other side of the story". As of this date no one has been able to explain why it was perfectly acceptable for the Colonists to secede from Great Britain, but deny that same option to the Souther states from the Union.

[Non-Sequitur]

As of this date no one has been able to explain why it was perfectly acceptable for the Colonists to secede from Great Britain, but deny that same option to the Souther states from the Union.

Let me try to explain then. The colonists did not secede from Great Britain. They rebelled. They were faced with intolerable oppression and made the conscious decision to forcibly break away from the crown, knowing full well that their actions were illegal in the eyes of the authorities and that they would have to fight for it. They made no pretense about their actions being legal, only morally justified. That is why it is called 'The American Revolution' or 'The Revolutionary War' and not 'The American Secession' or 'The Secessionary War'. Now, fast forward 80 years. The southern states rebelled. They were faced with what they saw was a threat to their domestic institution of slavery and made a conscious decision to forcibly break away, on the mistaken belief that their actions were legal. They tried to cover up their rebellion by calling it secession. The difference between the two is that the founding fathers had justification for their actions while the confederates did not, and the founding fathers won their rebellion and the confederates blew their opportunity by losing their war. Now is it clear?

[Non-Sequitur]

Read Lincoln's quotes regarding slavery and its relationship to the Union wherein he specifically states the "If the Union could be preserved with slavery, I would accept slavery."

Maybe an accurate quote would be better.

Hon. Horace Greeley:
Dear Sir.

I have just read yours of the 19th. addressed to myself through the New-York Tribune. If there be in it any statements, or assumptions of fact, which I may know to be erroneous, I do not, now and here, controvert them. If there be in it any inferences which I may believe to be falsely drawn, I do not now and here, argue against them. If there be perceptable [sic] in it an impatient and dictatorial tone, I waive it in deference to an old friend, whose heart I have always supposed to be right.

As to the policy I "seem to be pursuing" as you say, I have not meant to leave any one in doubt.

I would save the Union. I would save it the shortest way under the Constitution. The sooner the national authority can be restored; the nearer the Union will be "the Union as it was." If there be those who would not save the Union, unless they could at the same time save slavery, I do not agree with them. If there be those who would not save the Union unless they could at the same time destroy slavery, I do not agree with them. My paramount object in this struggle is to save the Union, and is not either to save or to destroy slavery. If I could save the Union without freeing any slave I would do it, and if I could save it by freeing all the slaves I would do it; and if I could save it by freeing some and leaving others alone I would also do that. What I do about slavery, and the colored race, I do because I believe it helps to save the Union; and what I forbear, I forbear because I do not believe it would help to save the Union. I shall do less whenever I shall believe what I am doing hurts the cause, and I shall do more whenever I shall believe doing more will help the cause. I shall try to correct errors when shown to be errors; and I shall adopt new views so fast as they shall appear to be true views.

I have here stated my purpose according to my view of official duty; and I intend no modification of my oft-expressed personal wish that all men everywhere could be free.

Yours,
A. Lincoln.

[Ditto]

For purposes of clarity, it is the first event out of which there is a clear succession of armed conflict through the war's known conclusion in 1865. Prior to Sumter one can find isolated events, mob actions, abolitionist insurrections and any number of other loosely relevant pre-war events involving arms.

Sumter was the culmination of 40 years of political and social disruption caused by one and only one factor -- the expansion of slavery. In fact, we could trace it back to 1787 and the compromises on slavery made in drafting the Constitution. With the election of Lincoln who ran on only one issue, free soil, the nation came to an impasse. There was no room left for compromise.

The best contemporary explanation for the impasse was Robert Toombs December 13, 1860 speech before the Georgia legislature.

With these vast advantages, ordinary and extraordinary, one would have supposed the North would have been content, and would have at least respected the security and tranquility of such obedient and profitable brethren; but such is not human nature. They despised the patient victims of their avarice, and they very soon began a war upon our political rights and social institutions, marked by every act of perfidy and treachery which could add a darker hue to such a warfare.

In 1820, the Northern party, (and I mean by that term now and whenever else it is used, or its equivalent, in these remarks, the Antislavery or Abolition party of the North,) endeavored to exclude the State of Missouri from admission into the Union, because she chose to protect African slavery in the new State. In the House, where they had a majority, they rejected her application, and a struggle ensued, when some half a dozen of Northern men gave way, and admitted the State, but upon condition of the exclusion of slavery from all that country, acquired from France by the treaty of 1802, lying north of thirty- six degrees thirty minutes, north latitude, and outside of the State of Missouri. This act of exclusion violated the express provisions of the treaty of 1802, to which the National faith was pledged; violated the well-settled policy of the Government, at least from Adams's administration to that day, and has, since slavery was adjudicated by the Supreme Court of the United States, violated the Constitution itself. When we acquired California and New- Mexico this party, scorning all compromises and all concessions, demanded that slavery should be forever excluded from them, and all other acquisitions of the Republic, either by purchase or conquest, forever.

This position of this Northern party brought about the troubles of 1850, and the political excitement of 1854. The South at all times demanded nothing but equality in the common territories, equal enjoyment of them with their property, to that extended to Northern citizens and their property ~ nothing more. They said, we pay our part in all the blood and treasure expended in their acquisition. Give us equality of enjoyment, equal right to expansion - it is as necessary to our prosperity as yours. In 1790 we had less than eight hundred thousand slaves. Under our mild and humane administration of the system they have increased above four millions. The country has expanded to meet this growing want, and Florida, Alabama, Mississippi, Louisiana, Texas, Arkansas, Kentucky, Tennessee, and Missouri, have received this increasing tide of African labor; before the end of this century, at precisely the same rate of increase, the Africans among us in a subordinate condition will amount to eleven millions of persons. What shall be done with them? We must expand or perish. We are constrained by an inexorable necessity to accept expansion or extermination. Those who tell you that the territorial question is an abstraction, that you can never colonize another territory without the African slavetrade, are both deaf and blind to the history of the last sixty years. All just reasoning, all past history, condemn the fallacy. The North understand it better - they have told us for twenty years that their object was to pen up slavery within its present limits - surround it with a border of free States, and like the scorpion surrounded with fire, they will make it sting itself to death. One thing at least is certain, that whatever may be the effect of your exclusion from the Territories, there is no dispute but that the North mean it, and adopt it as a measure hostile to slavery upon this point. They all agree, they are all unanimous in Congress, in the States, on the rostrum, in the sanctuary - everywhere they declare that slavery shall not go into the Territories.

It came down to this. The North, as embodied in the election of Lincoln, said that slavery could continue in the states where it currently existed, but could expand no further. To the average northern person as opposed to the small, but vocal abolitionist minority, that surely sounded like a reasonable position and they could not understand how it posed any threat to the south. But to the south, especially the slaveocracy who understood the economics of slavery far better than any northern politician, locking the rapidly expanding slave population within the confines of the existing slave states posed a deadly economic and social threat that would bring about their downfall within a generation or two. And it surely would have if they insisted on maintaining their existing economic and social structures. Expansion was the only way they saw to keep their way of life going at the ‘status quo’. It was a matter of economic and social survival for the slaveocracy.