A History of the United States

by Charles Kendall Adams; William P. Trent

MILITARY AND FINANCIAL STRENGTH OF THE COMBATANTS.

454. Comparative Numerical Strength.—As we have seen (§ [447]), the population of the seceded states was a little less than nine millions, of whom about five and one-half millions were whites; while the population of the other states was about twenty-two millions. At the beginning of the war a large proportion of the white adult males in the South was brought into action through public opinion, and a little later, a rigid conscription law, including all able-bodied men between fifteen and fifty, was rigorously enforced. Old men, women, boys, and slaves were left at home to furnish the necessary supplies. Thus the South put forth almost its entire strength early in the war, and the capture of territory and prisoners continually lessened its resources; while the very opposite was the case with the North. While the war was going on, the productive industries of the Union states never flagged, and the population continued to increase so that it was possible to have a larger army at the end of the war than at the beginning. However, all figures comparing the armies and the numbers present in individual battles are somewhat misleading, from the fact that in the Southern army teamsters and laborers on the supply trains were generally slaves, not enumerated. Slaves were also employed in the trenches. In the Northern armies, on the other hand, these forms of service were generally rendered by enlisted men.

455. Comparative Industries.—The South was essentially an agricultural region, depending for its income chiefly upon its exports of cotton and tobacco. If a blockade could be stringently enforced, this source of revenue must necessarily be cut off. But that was not all. The supplies which the South had been in the habit of importing could not now be procured except at enormous prices and in very small quantities. A few facts will show the significance of this condition. In 1860, the exports of cotton amounted in value to about two hundred millions of dollars, but before the end of the war, the annual income from that source was not more than four million dollars. The inducement to run the blockade may be inferred from the fact that the best cotton could be bought in Charleston at four or five cents a pound, while in Liverpool, where the American supply had been cut off, the price per pound was no less than two dollars and a half. Prospect of profit led to the most daring risks. Insurance on blockade running vessels rose nearly a thousand per cent, and the wages of sea captains plying between Nassau and Southern ports increased from thirty to one thousand pounds sterling per month. As we shall hereafter see, prices rose enormously in the South, and the suffering on the part of many became almost intolerable. This condition of affairs might have been prevented, if the South before the war had given itself to the development of varied industries. But, with all the able-bodied men in the field, the sudden establishment of industrial activity was plainly out of the question. In the North, on the other hand, the conditions were very different. At the beginning of the war, a high protective tariff was established, partly to provide an increased revenue, and partly to encourage the rapid spread of home industries. The consequence was great industrial activity throughout the entire period of the war. As the Northern ports were all open, intercourse with foreign markets was easy, and the rise of prices was not so great anywhere as to cause considerable inconvenience. In fact, the North grew steadily in wealth during the war.

456. Financial Methods in the North.—The cost of a great war is always so enormous that all the resources of taxation and credit must be resorted to. The necessities of the North were peculiarly stringent in 1861, owing to the fact that during Buchanan’s administration the Treasury was nearly bankrupt (§ [423]). As soon as the war began, the financial pressure was felt throughout the country, and before the end of 1861, the banks everywhere were obliged to suspend specie payment. A few months later, Congress authorized an issue of $150,000,000 of paper currency, and made it legal tender for the payment of all debts. In 1863, the amount of such notes was increased to $450,000,000; and from the color of the ink used, they came to be known as “greenbacks.” As they were not redeemable in gold at any specific time, the price of gold began to rise as soon as the first issue was made, and increased as the war progressed, until, in 1864, the premium on gold reached its highest point,—two hundred and eighty-five per cent. Of course, this premium was not an increase in the value of gold, but a decrease in the value of paper currency. As the current money became cheap, the prices of commodities naturally rose. It has been ascertained that the average increase in the prices of real estate, rents, and goods was about ninety per cent, while the increase in the price of labor was only about sixty per cent. Thus it is evident that the men of means profited most, or suffered least, by the inflation, while the laborer suffered most. Another source of income was the issue of government bonds at a high rate of interest. These amounted before the end of the war to $2,850,000,000. As during the first years of the contest the success of the North, and consequently the ability of the government to pay, appeared uncertain, it was difficult to sell the bonds except at a considerable discount.

457. National Banks.—An ingenious method of disposing of a large part of the bonds was devised. A law was enacted in February, 1863, authorizing any five persons to organize a National Bank on easy conditions. Except in very small places, such a bank was required to have a capital of at least one hundred thousand dollars and to deposit, with the Treasury at Washington, bonds to the amount of one-third of its capital. The government would then issue notes to the bank to the amount of ninety per cent of such deposit, such notes to be used by the bank for the purposes of circulating currency, and to be redeemable by the government in greenbacks. The response was at first slow; but in 1864 a new impulse was given to the movement by an act levying a tax of ten per cent on the circulation of state banks—a law designed to compel state banks to become national. By these measures, a safe and abundant currency was provided. In addition to these devices, a high internal revenue was levied, an income tax was provided, and tariff duties, as the war went on, were greatly increased.

458. Finances in the South.—No such fertile devices were possible in the South. Bonds were issued, but, as there was little or no capital seeking investment, no market at home could be found, and foreign capitalists would not run great risks till the issue of the war could be predicted with some confidence. The government then issued notes payable six months after the close of the war. With the diminishing prospects of the South, these notes rapidly declined in value, till they became practically worthless. Then the Confederate Congress authorized the army to seize provisions and supplies wherever they could find them, and to offer in payment bonds or notes at prices to be fixed every ninety days. Under this financial régime, prices rose enormously, and the consequent suffering of those who did not occupy their own estates or were not in the army or the service of the government, was well-nigh indescribable.

DESCRIPTION OF THE SEAT OF WAR.

459. General Features of the War.—Without some knowledge of the physical characteristics of the country, it will not be easy to understand why the war progressed so slowly as it did in the East and so rapidly in the West. As the South had broken away from the Union, and the North was trying to bring the seceded states back under national authority, the North was, necessarily, the attacking party, while the South had merely to act on the defensive. Though two important efforts were made by the South to transfer the field of operations to the North, these were both unsuccessful, and therefore the war, in all its larger features, was fought in the South. This fact makes it necessary to look for a moment at the physiographic features of the field of action.

460. Physical Features in the East.—The Alleghany Mountains and the Mississippi River divided the Confederacy into three somewhat distinct parts. The eastern portion, which lies between the Alleghanies and the Atlantic, is characterized by a succession of rivers that rise in the mountains and flow in a southeasterly direction nearly parallel with the Potomac and James. To advance through Virginia to Richmond, it was possible for the Union forces to go by water to the mouth of the James and then ascend along the river, or to cross the Rappahannock, the Rapidan, the York, and the Chickahominy, besides a large number of smaller streams which were sometimes swollen to the volume of navigable rivers. Much of the intervening region, moreover, was swampy, and at times almost impassable. East of the Alleghanies, the subordinate range known as the Blue Ridge provides a fertile, intervening valley, through which the Shenandoah flows northward into the Potomac at Harper’s Ferry. This Valley of Virginia, however, near the northern end, is subdivided by a low range of mountains in such a way as to enable an army driven down one side to retreat up the other. Across the Blue Ridge at Manassas Gap, a railroad connects the Valley with the eastern portion of Virginia and makes it possible to transfer troops rapidly from one side to the other. At Manassas, this railroad crosses an important Southern line which runs from Washington to Richmond and Lynchburg, and to the far South. This crossing, therefore, was of the first strategic importance in the war, and was naturally the first point of collision.

461. Physical Features of the West.—West of the Alleghanies the water courses, in some respects, were of even more importance than in the East. The Cumberland River, which rises in the mountains of the same name, flows southwest, and then, turning sharply to the north, empties into the Ohio some miles above Cairo. The Tennessee flows in the same general direction, but bends so far south as to reach Alabama and Mississippi, and then, turning northward and flowing through Tennessee and Kentucky in a course nearly parallel with the Mississippi, though in an opposite direction, discharges its waters into the Ohio. As railroads were few and other roads were poor, these navigable waters were of the utmost importance to the side that should be able to command them. Both antagonists recognized this fact, and, therefore, the first contest in this region was for command of these rivers. Soon after the war began, the Unionists took Cairo, at the mouth of the Ohio, and the Confederates constructed Forts Henry and Donelson, on the Tennessee and Cumberland rivers, at points not far from the Ohio, where the rivers were so near each other that either fort could easily reënforce the other. In this way each side hoped to gain command of the rivers for purposes of transportation. The Mississippi also was strongly fortified by the Confederates at Memphis, at Island Number 10, at Vicksburg, and at other points of less importance. West of the Mississippi, the physical features of the country were of less military consequence.