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The Economics of the Civil War
LewRockwell.com ^ | January 13, 2004 | Mark Thornton and Robert Ekelund

Posted on 01/13/2004 9:01:35 AM PST by Aurelius

Dust jackets for most books about the American Civil War depict generals, politicians, battle scenes, cavalry charges, cannons[sic] firing, photographs or fields of dead soldiers, or perhaps a battle between ironclads. In contrast our book {[url=http://search.barnesandnoble.com/booksearch/isbnInquiry.asp?userid=2XGHOEK4JT&isbn=0842029613&itm=7]Tariffs, Blockades, and Inflation: The Economics of the Civil War Mark Thornton, Steven E. Woodworth (Editor), Robert B. Ekelund[/url]features a painting by Edgar Degas entitled the "Cotton Exchange" which depicts several calm businessmen and clerks, some of them Degas’s relatives, going about the business of buying and selling cotton at the New Orleans Cotton Exchange. The focus of this book is thus on the economic rationality of seemingly senseless events of the Civil War – a critical period in American history.

What caused the war? Why did the Union defeat the Confederacy? What were the consequences of the War? The premise of the book is that historians have a comparative advantage in describing such events, but economists have the tools to help explain these events.

We use traditional economic analysis, some of it of the Austrian and Public Choice variety, to address these principal questions and our conclusions generally run counter to the interpretations of historians. In contrast to historians who emphasize the land war and military strategy, we show that the most important battle took place at sea. One side, the blockade runners, did not wear uniforms or fire weapons at their opponents. The other side, the blockading fleet, was composed of sailors who had weapons and guns but they rarely fired their cannons in hopes of damaging their opponents. Their pay was based on the valued of captured ships. 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.

Some now teach that slavery was the sole cause of the Civil War – an explanation that historians have developed in the twentieth century. However, this analysis does not explain why the war started in 1861 (rather than 1851 or 1841) and it fails to explain why slavery was abolished elsewhere without such horrendous carnage.

We emphasize economics and politics as major factors leading to war. The Republicans who came to power in 1860 supported a mercantilist economic agenda of protectionism, inflation, public works, and big government. High tariffs would have been a boon to manufacturing and mining in the north, but would have been paid largely by those in the export-oriented agriculture economy.

Southern economic interests understood the effects of these policies and decided to leave the union. The war was clearly related to slavery, but mainly in the sense that Republican tariffs would have squeezed the profitability out of the slave-based cotton plantation economy to the benefit of Northern industry (especially Yankee textiles and iron manufacturing). Southerners would also have lost out in terms of public works projects, government land giveaways, and inflation.

The real truth about wars is that they are not started over principle, but over power. Wars however, are not won by power on the battlefield, but by the workings and incentives of men who go to work in fields and factories, to those who transport, store and sell consumer goods, and most especially to the entrepreneurs and middlemen who make markets work and adapt to change. This emphasis and this economic account of tariffs, blockade and inflation, like the focus of Degas’s "Cotton Exchange" reveals the most important and least understood aspect of war.


TOPICS: News/Current Events
KEYWORDS: dixie; dixielist
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To: 4ConservativeJustices
Once agian, there was an election in 1860. That much is pretty undisputed.

Certain states refused to abide by the results of that election. I think that fact is indisputed. In most circles failing to abide by a legal election is insurrection.

If you have free elections you have to abide by them or you don't have a country.

And no the nation was not destroyed. Mr. Lincoln held it together. By force of arms which is regretable, but held togehter none the less.

621 posted on 01/20/2004 2:03:22 PM PST by hirn_man
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To: Aurelius
"The Erie Canal was constructed with state funding. Measuring 363 miles and connecting New York City with the Great Lakes, it was completed on October 26, 1825. The Canal extended from Albany to Buffalo. "

Economically the North won the war in 1825.

If Virginia had built the Kanawha canal to it's old terrirtories in the west- like every one of it's great men told it to- there would never have been a war. Well, South Carolina might have left on it's own I suppose.

622 posted on 01/20/2004 2:03:55 PM PST by mrsmith
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To: hirn_man
Were Germans obliged to abide by the results of their election in 1933?
623 posted on 01/20/2004 2:04:33 PM PST by aristeides
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To: Ditto
Man, that makes splended constitutional logic. </ sarcasm>

Moreso than the complete absence of anything prohibiting secession.

624 posted on 01/20/2004 2:04:35 PM PST by 4CJ (||) Dialing 911 doesn't stop a crime - a .45 does. (||)
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To: Non-Sequitur
While I agree that a Circuit Court may rule on cases in its district, I find the idea that something may be Constitutional in the 2nd District and not Constitutional in the 9th to be suspect.

Suspect it or not, it's the law. Consider the situation in the United States before the recent Michigan affirmative action case for college admissions as a case in point. Before the Supreme Court issued that ruling affirmative action-based admissions policies were illegal in some states but legal in others. The 5th Circuit for example struck down affirmative action for its states of jurisdiction (Texas, Louisiana, Mississippi) at the exact same time that Michigan was using the affirmative action system that landed them in court. Why? Because 5th Circuit rulings apply to states within the 5th Circuit. Other circuit rulings apply to their own respective states. If two of them do not make the same rulings on something then to each circuit his own, meaning contradictory affirmative action policies may simultaneously exist. It can be banned for the University of Texas but legal for the University of Michigan at the exact same time, and for a period of time before the Sandra Day O'Conner invented the "right to diversity," this was exactly the case.

625 posted on 01/20/2004 2:07:27 PM PST by GOPcapitalist
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To: hirn_man
If New York, Rhode Island, and Virginia were so insistant that they could seceede, maybe they should have got it written in the SUPREME LAW OF THE LAND.

They did. Amendments 9 and 10 were directly brought about by the demands of these and other states, particularly Virginia.

626 posted on 01/20/2004 2:08:50 PM PST by GOPcapitalist
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To: Ditto
So you would allow 3 states to peel-off unilaterally.

Who am I to stop them and in the case of California, why would I even want to stop them from leaving?

627 posted on 01/20/2004 2:12:07 PM PST by GOPcapitalist
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To: aristeides
I am not familiar with the constitution of Germany prior to WW2 or after.

If you are referring to Hitler, according to my inferior public education Hitler usurped power unconstitutionaly and was not originally elected.

Are you implying that Lincoln rose to power in any other means other than by a constitutional election? That the elections were rigged?
628 posted on 01/20/2004 2:13:38 PM PST by hirn_man
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To: GOPcapitalist
Ronald Reagan is a Californian. Why would you want him to lose his constitutionaly gaurenteed right to a republican form of government?
629 posted on 01/20/2004 2:15:30 PM PST by hirn_man
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To: hirn_man
The Nazi Party received the biggest vote in two elections that were quite free in 1932. The 1933 elections that gave a majority to the Nazis and their Nationalist coalition partners were still semi-free.
630 posted on 01/20/2004 2:17:36 PM PST by aristeides
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To: aristeides
Is a semi-free election kinda like being a little pregnant?

631 posted on 01/20/2004 2:21:53 PM PST by hirn_man
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To: 4ConservativeJustices
Thanks for the info - good stuff. The fact is, I need to research it further myself - taking all of the info into account - before I can form a position. It's a tough issue. I simply can't be dogmatic about anything at this point until I satisfy myself in my mind what the founders intended.
632 posted on 01/20/2004 2:24:36 PM PST by exmarine ( sic semper tyrannis)
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To: hirn_man
Before the semi-free election of 1933, there was government-sponsored propaganda, violence, and -- in the last days before the election, after the Reichstag Fire -- arrests. But an awful lot of people still felt free to vote for the non-government parties.

And it was quite consonant with democratic principles to give the government to the Nazis as the biggest party after the free elections of 1932. Eventually, Hindenburg did just that, at the end of January 1933, after attempts to avoid that path failed.

So, is it your position that Germans were obliged to abide by the results of the 1932 elections? And if Bavaria, say, had tried to secede in early 1933, is it your view that that would have been wrong, and rightly put down with force by the new government in Berlin?

633 posted on 01/20/2004 2:28:03 PM PST by aristeides
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To: aristeides
"So, is it your position that Germans were obliged to abide by the results of the 1932 elections?"

No it is my postion that the southern states of the United States of America having participated in a legitimate, free election were bound to the results of that election, and that since they didn't it was an insurrection.

You can think of all the hideous examples you want that create a "have you stopped beating your wife" sceanario.

I deal in reality. You're dealing in hypotheticals.
634 posted on 01/20/2004 2:41:05 PM PST by hirn_man
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To: hirn_man
Ronald Reagan is a Californian. Why would you want him to lose his constitutionaly gaurenteed right to a republican form of government?

He and any other conservative californian is free to either (a) campaign against that state's departure or (b) relocate from it to another more desirable state. If the majority of Californians are in favor of the state's departure though, I have no right to stop them nor will I be sad to see them go. The present California, combined with most areas to the north of the Hudson save New Hampshire, is a left wing jacobin anchor around the neck of this country. It is because of them, the way they vote, and the people who the majority of their residents send to Congress and other public offices in the majority of cases that this country is being drawn towards the left. They are also the regions that voted for Al Gore, the regions that want to abolish "one nation under God," the regions that support legalized sodomy, affirmative action, McCain-Feingold, welfare handouts, and the "right to diversity." So as much as I sympathize with their conservative minorities, I am harmed more by their liberal majorities and would be more than happy to see them go at a comparatively minor inconvenience (i.e. moving to another state) to the conservatives who live there.

635 posted on 01/20/2004 2:44:35 PM PST by GOPcapitalist
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To: GOPcapitalist
We live in a constitutional republic not a democracy.

Mob rule can't take a state out of the Union.

You guys are very inconsistant on that point.
636 posted on 01/20/2004 2:47:14 PM PST by hirn_man
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To: hirn_man
Were the German elections of 1932 not free and legitimate? The situation of which I speak was quite real, not hypothetical. The states of Germany did not attempt to secede, it is true, but I think the existence of that situation shows that you are wrong to insist that parties to free and legitimate elections must always abide by their results.
637 posted on 01/20/2004 2:55:21 PM PST by aristeides
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To: aristeides
And if Bavaria, say, had tried to secede in early 1933, is it your view that that would have been wrong, and rightly put down with force by the new government in Berlin?

LOL. Is there any question it would have been put down by force?

But again as Madison said, you confound a supposed right to secede at will violating your commitments, with the natural law right to rebel against oppression.

If a government were oppressing you, even with a right to secede, you would still need to fight for it since that government by definition does not respect your rights.

What the confederates did in 1861 was simply rebellion, and one that was not justifiable under natural law principles. They were not being oppressed in any way. The government had every right to crush that rebellion.

638 posted on 01/20/2004 2:57:33 PM PST by Ditto ( No trees were killed in sending this message, but billions of electrons were inconvenienced.)
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To: Ditto
But again as Madison said, you confound a supposed right to secede at will violating your commitments, with the natural law right to rebel against oppression.

You seem to presuppose a legal obligation not to secede, something that is at least not clear. Without such an obligation, secession would not have been rebellion, but the exercise of a legal right.

639 posted on 01/20/2004 3:10:40 PM PST by aristeides
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To: hirn_man
We live in a constitutional republic not a democracy. Mob rule can't take a state out of the Union.

Mob rule doesn't need to occur for a state to leave the union. It can just as easily go out through the processes of the existing republican system of governments in each state. Put differently, the state legislature or a legislative convention can adopt an ordinance of secession and enact it according to the processes of that particular state. State government systems vary in type meaning that some will do it slightly different than others. Some may hold a ratification referendum, some may not. But in each and every case the process can be republican.

640 posted on 01/20/2004 3:47:55 PM PST by GOPcapitalist
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