Policy of the Northern government. in the end they collapsed as no other conquered people have done in modern times. Far otherwise was it with the Northerners. Unused to arms but more accustomed to the management of great business enterprises, the Northern statesmen, when the departure of the Southerners from Congress finally gave them the control of the government, set about conquering the seceders with one hand, while they built up the industries of the North with the other. Long lines of new railroads opened up vast regions to settlement, a most liberal homestead law attracted migration to these new lands, and a high protective tariff enormously stimulated manufacturing enterprises. The North grew stronger in resources every year; every year there was a greater population from which to recruit the armies; every year there was a greater fund from which to draw revenue for the support of the war. The North was immeasurably better equipped for battle in 1865 than in 1861; but this vast industrial expansion absorbed the energies of a large portion of the adult male population. 339. Numbers. Colonel Theodore Ayrault Dodge, in the the contend- concluding chapter of his very interesting sketch of the Civil ing armies. War, gives some statistics from which it appears that the Union soldiers were always more numerous than their opponents at least on paper. For example, on the first day of July, 1861, the Union armies numbered one hundred and eighty-six thousand soldiers to some one hundred thousand on the other side. The Confederate soldiers in January, 1864, numbered nearly five hundred thousand. At that time there were about eight hundred and sixty thousand on the rolls of the Union army. Thenceforward the preponderance of the Unionists constantly increased until in January, 1865, they outnumbered the secessionists two to one. As will be seen later on, whenever the figures are given, it will be found that the Union soldiers taking part in any one campaign or battle outnumbered the Southerners, and this was the case in other engagements which are not recorded here or whose numbers are not given. It is true, Strength of Dodge's View, 116-121, 322-324. 1861] Strength of North and South 515 therefore, that according to the only records that are preserved, the Northern soldiers outnumbered their opponents whether taken as a whole, or considered in portions by campaigns or battles. There are few things, however, so unreliable as statistics, and these figures especially must always be regarded with the greatest caution. The Union soldiers performed many services which in the Southern armies were discharged by slaves or not at all. For example, the Northern soldiers drove the supply trains, acted as servants, and constructed defensive works, all of which duties were performed by negroes for the Southerners. It probably would not be far from the truth to say that, until the last year of the war, the number of soldiers actually equipped and ready to take their places in the fighting line was about the same on both sides. The Confederates, also, by reason of their better knowledge of the country, their superior marching qualities, and their shorter interior lines, were able to reinforce their armies at the most important points with greater ease and speed than the Union authorities could. It was not until 1864 that the Union forces were really superior in numbers at all points. 340. Northern Finances, 1861-65. — During the clos- Northern ing months of Buchanan's administration the federal governfinances, 1861-65. ment had become nearly bankrupt and had been able to fulfill its obligations only by means of loans at very high rates of interest. No sooner was the war begun than great pressure was felt not only by the general government but by the state governments, the municipalities, and financial institutions in general. Before the close of 1861 the banks everywhere suspended specie payments. Temporary expedients tided the government over the first months of the war. Congress assembled on July 4, 1861. It at once authorized a loan and raised the import duties. The Morrill Tariff (p. 491), passed in 1860, before the war was thought of, became the basis of new taxation, and from this time until the close of the conflict, not a session of Congress went by without some increase of the duties on im ports. The most important of these measures will be noted later. In February, 1862, Congress authorized the issue of one hundred and fifty million dollars of paper money and made them legal tender in payment of debts. Before the end of 1863, the amount was increased to four hundred and fifty millions. The premium on gold at once began to rise; in 1863 it reached one hundred and seventy per cent, and in 1864 touched the highest mark, two hundred and eighty-five per cent. Prices and rents, of course, at once rose, and at the end of the contest were nearly ninety per cent 5.500.000 March, 21865 It is hereby certified that tun million give hundred thousand detters 500.000 Have been deposited with the Treasurer of the United States 1. Payable in C&DREXEL, MORGAN & CO. MORTON BLISS & CO. JAY COOKER Co. or their order Washington, Septender, que 1873 higher than in 1861. Wages and salaries rose also, but not in a corresponding degree—not more than sixty per cent. From these facts it can easily be seen that the real cost of the war fell most heavily on the poorer classes—on those who had nothing to sell save their labor. This, indeed, is the invariable effect produced by inflation of the currency medium. Another source of funds to which the government had frequent recourse was the issue of bonds at high rates of interest to be paid for in the government's own depreciated currency. In all, the government incurred a 1861] The National Banking System 517 debt of the face value of two thousand eight hundred and fifty millions of dollars, or, including the outstanding paper currency or greenbacks, over three billion dollars. 341. The National Banking System. As the contest National deepened, it became more and more difficult to sell these banks. bonds, no matter what the rate of interest or the amount of depreciation of the currency which could be paid for them; the people had so little confidence in the stability of the government that they were not willing to lend money on any terms. Subscriptions to bonds fell off and a new expedient to dispose of them was invented. This was the national banking system, based on the New York banking. system (p. 430). The first law on the subject was passed in February, 1863, and provided that any five or more. persons with a minimum capital of one hundred thousand dollars in very small places even less might organize a national bank on depositing with the government United States bonds to the amount of one third of their capital. In exchange for these bonds, the government issued to the depositing bank notes redeemable in greenbacks to the amount of ninety per cent of the value of the bonds deposited. A market for the bonds of the United States would be thus obtained, and a stable currency provided for the country. At first the response to this offer was not encouraging, but in March, 1864, Congress laid a tax of ten per cent on the circulation of the state banks, and they at once complied with the provisions of the act of 1863 and became national banks. 342. Increased Taxation. Irredeemable paper currency Taxation. and bonds, even when helped by the national bank act, did not meet the needs of the government. In 1862 the source of revenue which had been discarded by Jefferson was again brought into use: by the Internal Revenue Act of that year Congress established a comprehensive scheme of excise taxation: specific taxes were imposed on the production of iron and steel, coal oil, paper, leather, and countless other manufactured articles, and a general ad Southern finances, 1861-65. valorem tax on all manufactures not included in this category; licenses were required in many callings, and a general income tax was imposed; and steamboat, railroad, and express companies were also required to pay taxes on their gross receipts. Such a system of heavy taxes on goods manufactured in the country would have destroyed the protective nature of the tariff; it was necessary, therefore, to raise the duties levied on imports correspondingly. In CONFEDERATE STATES ALMANAC FOR THE YEAR OF OUR LORD 1864 BEINO DISSEXTILE OR LEAP YEAR AND THE 4TH YEAR CALCULATIONS MADE AT PUBLISHED FOR THE TRADE BY... BURKE, BOYKIN & CO., J. MCPHERSON & CO., 1864 the internal revenue system was enormously extended, and in connection with it another tariff act was passed which raised the duties on the protected articles out of all proportion to the new internal revenue taxes. The last act was passed after only five days' discussion, owing to the pressure of urgent need. It substantially remained in force for twenty years, although the high internal taxes which justified the high rates on protected goods were, meantime, largely lowered or entirely abolished. 343. Southern Finances, 1861-65. — The ever-strengthening flood of industry in the North made it possible to raise large amounts by taxation, and, in combination with the success of the Northern armies after 1863, gave a basis for credit upon which to float large issues of bonds. The South had no similar resources. There was slight commercial activity in the seceded states during peaceful times, and almost no industry save the cultivation and exportation of large crops of cotton and tobacco. The Northern blockade of Southern ports effectually stopped this export trade, and put an end to the inflow of goods needed in everyday life. |