A Brief History of the United States

by John Bach McMaster

One of them, the Alabama, sailed the ocean unharmed for two years. She cruised in the North Atlantic, in the Gulf of Mexico, in the Caribbean Sea, off the coast of Brazil, went around the Cape of Good Hope, entered the China Sea, came again around the Cape of Good Hope, and by way of Brazil and the Azores to Cherbourg in France. During the cruise she destroyed over sixty merchantmen. At Cherbourg the Alabama was found by the United States cruiser Kearsarge, and one Sunday morning in June, 1864, the two met in battle off the coast of France, and the Alabama was sunk. [4]

OPERATIONS ALONG THE COAST.—Besides blockading the coast, the Union navy captured or aided in capturing forts, cities, and water ways. The forts at the entrance to Pamlico Sound and Port Royal were captured in 1861. Control of the waters of Pamlico and Albemarle [5] sounds was secured in 1862 by the capture of Roanoke Island, Elizabeth City, Newbern, and Fort Macon (map, p. 369). In 1863 Fort Sumter was battered down in a naval attack on Charleston. In 1864 Farragut led his fleet into Mobile Bay (in southern Alabama), destroyed the Confederate fleet, captured the forts at the entrance to the bay, and thus cut the city of Mobile off from the sea. In 1865 Fort Fisher, which guarded the entrance to Cape Fear River, on which was Wilmington, fell before a combined attack by land and naval forces.

ON THE INLAND WATERS.—On the great water ways of the West the notable deeds of the navy were the capture of Fort Henry on the Tennessee by Foote's flotilla (p. 358), the capture of New Orleans by Farragut (p. 361), and the run of Porter's fleet past the batteries at Vicksburg (p. 368).

[Illustration: ONE OF PORTER'S GUNBOATS PASSING VICKSBURG.]

THE MONITOR AND THE MERRIMAC .—But the most famous of all the naval engagements was that of the Monitor and the Merrimac in 1862. When the war opened, there were at the navy yard at Norfolk, Virginia, a quantity of guns, stores, supplies, and eleven vessels. The officer in command, fearing that they would fall into Confederate hands, set fire to the houses, shops, and vessels, and abandoned the place. One of the vessels which was burned to the water's edge and sunk was the steam frigate Merrimac. Finding her hull below the water line unhurt, the Confederates raised the Merrimac, turned her into an ironclad ram, renamed her Virginia, and sent her forth to destroy a squadron of United States vessels at anchor in Hampton Roads (at the mouth of the James River).

[Illustration: MERRIMAC AND MONITOR.]

Steaming across the roads one day in March, 1862, the Merrimac rammed and sank the Cumberland, [6] forced the Congress to surrender, and set her on fire. This done, the Merrimac withdrew, intending to resume the work of destruction on the morrow; for her iron armor had proved to be ample protection against the guns of the Union ships. But the next morning, as she came near the Minnesota, the strangest-looking craft afloat came forth to meet her. Its deck was almost level with the water, and was plated with sheets of iron. In the center of the deck was an iron- plated cylinder which could be revolved by machinery, and in this were two large guns. This was the Monitor [7] which had arrived in the Roads the night before, and now came out from behind the Minnesota to fight the Merrimac. During four hours the battle raged with apparently no result; then the Merrimac withdrew and the Monitor took her place beside the Minnesota. [8] This battle marks the doom of wooden naval vessels; all the nations of the world were forced to build their navies anew.

FINANCES OF THE WAR.—Four years of war on land and sea cost the people of the North an immense sum of money. To obtain the money Congress began (1861) by raising the tariff on imported articles; by taxing all incomes of more than $800 a year; and by levying a direct tax, which was apportioned among the states according to their population. [9] But the money from these sources was not sufficient, and (1862) an internal revenue tax was resorted to, and collected by stamp duties. [10] Even this tax did not yield enough money, and the government was forced to borrow on the credit of the United States. Bonds were issued, [11] and then United States notes, called "greenbacks," were put in circulation and made legal tender; that is, everybody had to take them in payment of debts. [12]

MONEY IN WAR TIME.—After the government began to issue paper money, the banks suspended specie payment, and all gold and silver coins, including the 3, 5, 10, 25, and 50 cent pieces, disappeared from circulation. The people were then without small change, and for a time postage stamps and "token" pieces of brass and copper were used instead. In March, 1863, however, Congress authorized the Issue of $50,000,000 in paper fractional currency. [13] Both the greenbacks and the fractional currency were merely promises to pay money. As the government did not pay on demand, coin commanded a premium; that is, $100 in gold or silver could be exchanged in the market (down till 1879) for more than $100 in paper money.

NATIONAL BANKS.—Besides the paper money issued by the government there were in circulation several thousand different kinds of state bank notes. Some had no value, some a little value, and others were good for the sums (in greenbacks) expressed on their faces. In order to replace these notes by a sound currency having the same value everywhere, Congress (1863) established the national banking system. Legally organized banking associations were to purchase United States bonds and deposit them with the government. Each bank so doing was then entitled to issue national bank notes to the value of ninety per cent [14] of the bonds it had deposited. Many banks accepted these terms; but it was not till (1865) after Congress taxed the notes of state banks that those notes were driven out of circulation.