Tag Archives: Post Civil War Tariffs

How The South Has Already Paid Reparations

(October 25, 2019) American Spectator released my “The South Has Already Paid Reparations” article earlier today. It documents how Southerners, black and white, paid taxes to fund Northern costs of the Civil War for more than a hundred years after the war.

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The South Has Already Paid Reparations

Ignored among current reparations discussions is the fact the South has already paid them — if not for slavery, then for losing the Civil War. For at least 25 years after the war, over half of the federal budget was devoted to three items: interest on federal debt; budget surpluses applied to debt retirements; and Union veterans’ pensions. None benefitted former Confederates even though they had to pay their share of taxes to fund them. If the Confederacy had been an independent defeated foe, such payments would have constituted reparations.

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The budget surpluses were used to pay down the federal war debts, which had increased 40-fold from $65 million at the start of the Civil War to $2.7 billion at the end. Southerners did not hold any of the bonds. National banks held some, which bought them for monetary reserves as mandated by the 1863 National Banking Act, but many Northern civilians also owned them.

Bond policies also penalized Southerners (black and white) another way. Specifically, the 1869 Public Credit Act required that the bonds be redeemed in gold even though Northern investors bought them during the war with Greenback paper money, which traded at a fluctuating discount to gold. Less than a year before the war ended, Greenback dollars traded at a 65 percent discount to gold in July 1864. Since the bond redemptions and interest had to be paid in gold, the value of paper money required to make such payments was larger than the face amount of the bonds and their associated interest coupons. The difference was an extra cost to the taxpayer but a bonus to the Northern bondholder.

Continue Reading at American Spectator

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To learn more about how the South was impacted by the aftermath of the Civil War consider reading:

Southern Reconstruction by Philip Leigh
U. S. Grant’s Failed Presidency by Philip Leigh

 

How Tariffs Contributed to the Civil War

(December 18, 2017) While most modern historians minimize tariffs as a cause of the Civil War they nearly always fail to consider three points.

First, instead of explaining why tariffs fell from 1846 to the eve of the Civil War in 1860, they merely point to the decline as a reason to deny that the South could have been much concerned about future tariff policy. Nonetheless, one reason American rates dropped was because Great Britain had convicingly demonstrated the prosperity that free trade could provide after she abolished nearly all agricultural tariffs in 1846 and thereafter became the World’s mightiest economy. A second reason was that Britain’s action cut the legs out from under domestic protectionists who had eternally pointed to English trade barriers to justify the perpetuation of high American tariffs.

Second, they ignore the ancient wisdom: “To the victor belong the spoils.” Specifically, after winning the war, the Northern states increased America’s tariff on dutiable items from 18% before the war to an average of 45% for almost fifty years after the war. Rates dropped only temporarily during President Wilson’s era and then shot back up when the Republicans regained control of the federal government during the Roaring Twenties. America did not move toward a free trade posture until after World War II when the destroyed economies of Europe and Asia were incapable of offering any competition. Realizing that the fortunes of war had this time left them with a near worldwide monopoly on manufactured goods the Northern states suddenly wanted every country to remove tariffs.

Third, while they eagerly proclaim that the Confederate Constitution specifically legalized slavery, they almost always fail to point out that it also outlawed tariffs designed to protect any domestic industry. The Confederates regarded such tariffs as form of government welfare for politically well connected industries.

James Bovard provides a good two-part analysis of America’s historical tariffs up to the early 1930s. The second part is pertinent to the Civil War era. The first part is available through a link at the top of the second part.

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Presently Amazon and Barnes & Noble Online are out-of-stock of my latest book, Southern Reconstruction. Although my publisher has ordered a second printing, the production run will not be completed before Christmas.

Meanwhile, some physical Barnes & Noble stores do have them in stock. Go to this link, and click on the “Want it today? Check Store Availability,” which is in small print to the right of the picture cover. The link will prompt you to enter your zip code and afterward display a list of stores nearby and will also indicate which ones have Southern Reconstruction in stock. Some other independent physical stores may also have the title in stock.

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