WEBVTT NOTE How Did the North Win? 1 00:00:00.000 --> 00:00:11.000 Well, it's great to be with you here at the Ludwig von Mises Institute and giving a seminar for the Auburn University Academy of Lifelong Learners. 2 00:00:11.000 --> 00:00:22.000 The title of this seminar is the same title as the book, Tariffs, Blockades, and Inflation, the Economics of the Civil War. 3 00:00:22.000 --> 00:00:40.000 And I want to begin today by talking about some of the preliminaries, some of the general issues about the book, and maybe get into part of the first chapter, core chapters of the book as well. 4 00:00:40.000 --> 00:01:05.000 I'll try to lecture for about 45 minutes until 3.15 and then we'll take a break and then we'll come back and discuss some of the issues that have been raised or some of the ideas that you've sort of hit on as we go through the material and discuss that or continue on with that first chapter. 5 00:01:05.000 --> 00:01:11.760 in this class there's a lot of things that I'd like to cover and like to 6 00:01:11.760 --> 00:01:17.720 accomplish the Civil War, America's Civil War and of course it goes by many 7 00:01:17.720 --> 00:01:24.560 different titles especially around Auburn but it really is a very important 8 00:01:24.560 --> 00:01:29.840 issue for Americans and I think a lot of people around the world are interested 9 00:01:29.840 --> 00:01:35.920 in this particular historical episode that is so important to Americans and of 10 00:01:35.920 --> 00:01:43.000 course if you look out there in the world what you'll find is that shows 11 00:01:43.000 --> 00:01:48.800 about the Civil War factual and fictional are on the television all the 12 00:01:48.800 --> 00:01:55.560 time there's movies being made about the Civil War and various battles books 13 00:01:55.560 --> 00:02:07.560 and other books continue to pour out about this subject, both of an academic nature, fictional, even science fiction books about the Civil War. 14 00:02:07.560 --> 00:02:22.560 So it's a tremendous interest to Americans and it has a tremendous entertainment value for us and that interest only seems to be growing over time. 15 00:02:22.560 --> 00:02:33.560 However, it's also about some very serious matters. War is definitely one of the most important issues that we discuss and that we debate. 16 00:02:33.560 --> 00:02:44.560 War is something that brings out the very best in people, and it also is something that brings out the very worst in people. 17 00:02:44.560 --> 00:03:10.560 So it is something that's very destructive and yet if we learn from war then it can also be tremendously instructive and that's hopefully what we're going to accomplish here is to take that importance of America's Civil War and turn it into instructive material for us, something that's going to benefit us all. 18 00:03:10.560 --> 00:03:23.560 Now, this book, which was published in 2004, my co-author on the book is Robert Eakland, 19 00:03:23.560 --> 00:03:32.560 Bob is the Edward and Catherine Lauder eminent scholar at Auburn University, recently retired, 20 00:03:32.560 --> 00:03:38.560 and a co-author on all of my academic papers on this subject, 21 00:03:38.560 --> 00:03:46.560 as well as my co-author on the book and of course he deserves tremendous credit for all of this as well. 22 00:03:46.560 --> 00:03:54.560 But what we do that's very unique amongst the thousands and thousands of books out there in the marketplace that you could pick up 23 00:03:54.560 --> 00:04:05.560 and if you went to amazon.com and typed in Civil War I'd hesitate to think of how many hundreds and hundreds of books that would currently be available 24 00:04:05.560 --> 00:04:15.560 or if you went up to the Auburn University Library and looked in the section on the Civil War, how many stacks and stacks of books that you'd find on the subject, 25 00:04:15.560 --> 00:04:22.560 what we try to do is to present an economic perspective on the Civil War. 26 00:04:22.560 --> 00:04:34.560 We're not really interested in the battles, we're not really interested in the tactics, the heroism, the strategies, 27 00:04:34.560 --> 00:05:04.560 The individual people who play various important roles, all of that is tremendously important, and that is really covered in just tremendous detail by historians, who have done just a wonderful job, and I'm not talking about just the high flight academic historians, but there's all sorts of amateur historians that have contributed so much, every regiment, many, many individual soldiers, 28 00:05:04.560 --> 00:05:17.560 The stories have been told in book-length treatments, towns and cities and battlefields, particular battles, types of armaments, and the list goes on and on. 29 00:05:17.560 --> 00:05:33.560 But that's really the historical perspective, the description of what went on, and the development of stories from facts to convey our history. 30 00:05:33.560 --> 00:05:40.560 The Economic Perspective is going to be very different. It's about the same material, but it's going to be very different. 31 00:05:40.560 --> 00:05:45.560 And we try to show that to our readers on the cover itself. 32 00:05:45.560 --> 00:05:57.560 Now, I don't see anybody who bought the hardback copy, but it's a beautiful book, and my royalties are actually much better on the hardback. 33 00:05:57.560 --> 00:06:15.560 I encourage you all to also buy a copy of the hardback book. But the paperback copy, I think, is actually much better looking and a much nicer treatment and more informative. 34 00:06:15.560 --> 00:06:43.560 and I've got a poster, a little poster of our book up here. On the cover is a painting by Edward Degas, the famous French painter and this was done right after the war and it's a picture, it's called the Cotton Exchange and Degas visited the United States, he had relatives in New Orleans, 35 00:06:43.560 --> 00:06:50.460 in New Orleans, who were cotton brokers, who basically bought and sold cotton for shipment 36 00:06:50.460 --> 00:06:56.520 to Europe, and of course most of the cotton that was produced in the South, a lot of that 37 00:06:56.520 --> 00:07:01.920 was shipped through New Orleans, and this is a picture that he, a painting that he did 38 00:07:01.920 --> 00:07:07.080 while here in the United States, and this is the office of the cotton exchange, where 39 00:07:07.080 --> 00:07:16.780 Where his uncles and family members worked and it's one of his more famous paintings. 40 00:07:16.780 --> 00:07:17.780 And what does it tell us? 41 00:07:17.780 --> 00:07:23.080 Well, first of all, if you look at other civil books about the Civil War, what you'll find 42 00:07:23.080 --> 00:07:24.080 is what? 43 00:07:24.080 --> 00:07:30.140 You'll find pictures of soldiers with their uniforms on or you'll see pictures of iron 44 00:07:30.140 --> 00:07:36.940 clad ships or cannons being fired or horses charging into battle or battle scenes or 45 00:07:36.940 --> 00:07:50.940 There's soldiers marching into battle. It's all about the battlefield. It's all about the war more directly itself. 46 00:07:50.940 --> 00:08:00.940 What we're trying to convey here is ultimately what is going beyond, behind the lines of engagement. 47 00:08:00.940 --> 00:08:30.940 What's going on away from the battlefield on the home front and also what was really the important issue with respect to the war with the economic issue as we're going to find has a whole lot to do with cotton and so that's one of the reasons if you in the very beginning of the book there's actually a map of mostly of the southern United States and what we have highlighted on the map is 48 00:08:30.940 --> 00:08:40.540 is the areas in which cotton was grown and also there's a layover of the railroads that were in existence in the southern economy. 49 00:08:40.540 --> 00:08:54.640 So, the whole cover really is designed to redirect our attention away from the battlefield and back to the economy as a very important issue. 50 00:08:54.640 --> 00:09:00.240 Now, one of the things that we're going to cover is what was the cause of the war. 51 00:09:00.240 --> 00:09:18.140 And what we argue in the book, and of course we'll go into this in a great deal of detail, is that the role of slavery versus the role of cotton. 52 00:09:18.140 --> 00:09:26.480 So we're going to look at that issue in great detail, and I'm going to explain our perspective here today before we get to the actual issue, 53 00:09:26.480 --> 00:09:34.240 Because over time, slavery has become the cause of the Civil War. 54 00:09:34.240 --> 00:09:39.120 In fact, it's really become the only cause of the Civil War. 55 00:09:39.120 --> 00:09:46.520 That is a very modern development. 56 00:09:46.520 --> 00:09:48.560 Even when I was a college student, 57 00:09:48.560 --> 00:09:50.480 the cause of the war was described 58 00:09:50.480 --> 00:09:53.120 as being multiple causes, that there 59 00:09:53.120 --> 00:10:13.120 There were multiple causes that coalesced into the Civil War and we go from there but we look very carefully and place a lot of prominence on economic factors and a lot of those are related to cotton. 60 00:10:13.120 --> 00:10:18.120 We're also going to look at the outcome of the Civil War. 61 00:10:18.120 --> 00:10:22.120 How did the Union government win this war? 62 00:10:22.120 --> 00:10:29.000 Very important question because it's something they weren't supposed to do. 63 00:10:29.000 --> 00:10:36.100 Nobody thought that the Union could win the Civil War when it first started. 64 00:10:36.100 --> 00:10:39.580 We're going to look at the aftermath of the war. 65 00:10:39.580 --> 00:10:43.460 How did this impact American society? 66 00:10:43.460 --> 00:10:48.180 How has, in other words, how did the results of those historical events, how do they feed 67 00:10:48.180 --> 00:10:51.620 into what we are living today? 68 00:10:51.620 --> 00:11:01.620 So we're going to look at the direct aftermath of the war, but we're also going to look at the fallout of the Civil War as it comes into our own daily lives. 69 00:11:01.620 --> 00:11:10.620 The economic impacts, the impact on our economic institutions, our government, how did it change our form of government? 70 00:11:10.620 --> 00:11:16.620 In particular, we'll take a look at how did it affect the former slave population? 71 00:11:16.620 --> 00:11:30.620 And then, of course, we'll want to look at, in retrospective, what are the lessons that we can learn about the Civil War that would benefit us today. 72 00:11:30.620 --> 00:11:35.620 So those are some of the things that we're going to cover and that we hope to accomplish. 73 00:11:35.620 --> 00:11:41.620 First, I'd like to talk a little bit about the background of this book. Where did it come from? 74 00:11:41.620 --> 00:11:45.620 Reading a book, this is something you wouldn't normally be exposed to. 75 00:11:45.620 --> 00:11:55.620 But if you're getting it directly from the horse's mouth, you might benefit from a little of the background from how this project came to be. 76 00:11:55.620 --> 00:12:02.620 It actually started when I was writing my dissertation in economics here at Auburn University. 77 00:12:02.620 --> 00:12:09.620 My dissertation was on the economics of prohibition and I was explaining in the dissertation 78 00:12:09.620 --> 00:12:33.620 I had a footnote in my dissertation about this subject, and it basically said this phenomenon is very similar to what happened in the Confederacy during the Civil War. 79 00:12:33.620 --> 00:12:46.620 And of course it had to do with goods coming into the country. In the case of drugs, it was illegal drugs being shipped from South America into the United States. 80 00:12:46.620 --> 00:12:55.620 In the case of the Civil War, it was goods being shipped in from Bermuda and the Bahamas into the United States. 81 00:12:55.620 --> 00:13:09.620 In the case of drugs, of course, they had to get through the drug enforcement agency, the Coast Guard, and all of our other agencies that try to prohibit drugs from getting into the country. 82 00:13:09.620 --> 00:13:14.620 In the Civil War, the smugglers had to get through the Union blockade. 83 00:13:14.620 --> 00:13:25.620 So you had a similar situation and you had a similar type of effect on the type of commodities that were coming across the border and into the ports. 84 00:13:25.620 --> 00:13:37.620 Well, my dissertation chairman at the time made note of that and said that, you know, that I should write an article about that, 85 00:13:37.620 --> 00:13:42.980 Subject Extending it into the Civil War and that actually was the first paper 86 00:13:42.980 --> 00:13:51.940 that we wrote on this subject where we looked at why was it that blockade 87 00:13:51.940 --> 00:13:59.380 runners were bringing in party dresses and candy and all sorts of fancy things 88 00:13:59.380 --> 00:14:04.980 and and they weren't bringing in gunpowder and flour to make bread and 89 00:14:04.980 --> 00:14:34.980 and things of that nature and that that was a very demoralizing effect on southerners because they were going hungry, clothing was very difficult to buy or to acquire and yet, you know, fancy luxury goods were coming into the country and party dresses and parasols and jewelry even and so that was very demoralizing and in the paper we basically 90 00:14:34.980 --> 00:14:59.980 This article basically explained why smugglers or drug runners do what they do, and we called it the Rhett-Butler Effect, because Rhett-Butler was one of those, of course, fictional, but still a blockade runner who always had, you know, fancy cognacs and party dresses to give away to his girlfriends and things of that nature. 91 00:14:59.980 --> 00:15:06.260 First article, and based on the success of that, we did another article, which we called 92 00:15:06.260 --> 00:15:13.180 the Confederate Blockade of the South. And in that article, we described all of the policies 93 00:15:13.180 --> 00:15:18.940 that the Confederate government put into place that actually made it more difficult for the 94 00:15:18.940 --> 00:15:26.000 blockade runners to do their job. So in effect, they were putting taxes on the blockade runners 95 00:15:26.000 --> 00:15:49.000 The papers who were bringing, trying to bring them guns into the country, trying to bring products into the country, they were putting all sorts of restrictions and taxes on cotton, and so it made it more difficult for them to run goods in and to run cotton out, and that was of course the economic bloodline of the southern economy. 96 00:15:49.000 --> 00:16:01.600 Now, that paper was probably more controversial, let's say, and we had a journal editor who 97 00:16:01.600 --> 00:16:09.280 had agreed to publish it, and then the journal editor got into trouble with his publisher 98 00:16:09.280 --> 00:16:16.320 and resigned, and our paper, and discouraged at that point, we decided to drop the project, 99 00:16:16.320 --> 00:16:22.720 Until a number of years later, when that same journal editor became the Civil War history 100 00:16:22.720 --> 00:16:30.280 editor for a publisher called Scholarly Resources who ultimately ended up publishing this book. 101 00:16:30.280 --> 00:16:34.740 And so he remembered our paper and the work that we had done on that subject and he contacted 102 00:16:34.740 --> 00:16:39.480 us and said, you guys really need to write a book on this subject. 103 00:16:39.480 --> 00:16:46.920 And so, encouraged with all that, we resurrected the paper that had been rejected and we started 104 00:16:46.920 --> 00:16:49.720 in on the manuscript for this book. 105 00:16:49.720 --> 00:16:54.520 The paper, The Confederate Blockade of the South, was recently published in the Quarterly 106 00:16:54.520 --> 00:16:57.080 Journal of Austrian Economics. 107 00:16:57.080 --> 00:17:02.240 We had another paper that was published in the Eastern Economic Journal called The Unintended 108 00:17:02.240 --> 00:17:05.880 Consequences of Confederate Trade Policy. 109 00:17:05.880 --> 00:17:11.080 And we even have another future article that's in production on this subject. 110 00:17:11.080 --> 00:17:20.880 So it's been a rather long and difficult route to bring this project to fruition, but it's 111 00:17:20.880 --> 00:17:25.140 also been a very satisfying one at the same time. 112 00:17:25.140 --> 00:17:31.000 The book itself actually seems to have a secret mission that was unintended when I first started 113 00:17:31.000 --> 00:17:35.340 studying the Civil War and actually when I was reading about the Civil War it was something 114 00:17:35.340 --> 00:17:53.500 The book itself has a secret mission and that is to explain the outcome of the Civil War. 115 00:17:53.500 --> 00:18:04.100 That's not emphasized a lot in the book directly, but it is touched on throughout the book. 116 00:18:04.100 --> 00:18:06.820 Why did the Confederate government fail? 117 00:18:06.820 --> 00:18:15.660 Why did the Union government succeed when by and large the odds were not for that type 118 00:18:15.660 --> 00:18:19.260 of outcome? 119 00:18:19.260 --> 00:18:29.260 The North and the South were relatively equally matched until the Midwestern states joined with the Union. 120 00:18:29.260 --> 00:18:34.460 And the South was fighting a defensive battle. 121 00:18:34.460 --> 00:18:43.260 They essentially had the same type of population, the same type of military training, the same type of military technology. 122 00:18:43.260 --> 00:19:01.260 And so when you have two groups who are fighting one another that are essentially the same in terms of personnel, in terms of training, in terms of technology, the one that's on the defense almost always wins. 123 00:19:01.260 --> 00:19:08.260 And so it was very unclear that the Union could have actually won this victory, which it did. 124 00:19:13.260 --> 00:19:29.260 The modern explanation of the Union victory is simply that the Union was bigger, that it had more people, that had a larger economy, that had larger capital stock than the South. 125 00:19:29.260 --> 00:19:46.260 So the bigger battalions theory of the Union Victory. We see the source of Union Victory not on the battlefield at all, as most historians would, but rather in the blockade. 126 00:19:46.260 --> 00:19:58.260 Most of our research is on the blockade, but we really do feel that that was the source of Union Victory. 127 00:19:58.260 --> 00:20:14.260 And so there's a pretty good emphasis on that in the book itself. 128 00:20:14.260 --> 00:20:26.260 And I think if you look at that issue, you'd say, first of all, the land battle, if you study the battles, the land war was really a stalemate. 129 00:20:26.260 --> 00:20:38.020 Most of the battles where large armies would come together, both sides would lose a large number of troops, but the lines of engagement wouldn't change that much. 130 00:20:38.020 --> 00:20:43.020 Okay, so that the North and the South were relatively evenly matched on the battlefield, 131 00:20:43.020 --> 00:20:53.020 relatively even number of victories, and none of the victories were really very compelling until towards the end of the war. 132 00:20:53.020 --> 00:21:00.020 And as we get towards the end of the war, the blockade itself becomes stricter and stricter and stricter, 133 00:21:00.020 --> 00:21:07.020 the Union controls more and more southern ports, they have more and more blockade ships, 134 00:21:07.020 --> 00:21:13.020 and the Confederate policy becomes more and more difficult for blockaders to deal with. 135 00:21:13.020 --> 00:21:21.020 So as the blockade becomes more effective, southern prospects in terms of the war diminish greatly. 136 00:21:21.020 --> 00:21:26.020 And then, of course, right after the blockade became completely effective, 137 00:21:26.020 --> 00:21:35.020 when Wilmington, North Carolina fell as the last open port to blockaders, Lee's army dissolved shortly thereafter. 138 00:21:35.020 --> 00:21:50.520 So I think that we're going to make a good case that it was the war at sea, not the war on land, that really was the key aspect of the war. 139 00:21:50.520 --> 00:21:59.420 The first chapter of the book is mostly a step back to economics. 140 00:21:59.420 --> 00:22:15.420 So some of this I'm going to go through in a cursory fashion in terms of the technical economics and explain it in more detail as we get to the actual meat of the matter in the chapters that follow. 141 00:22:15.420 --> 00:22:21.420 And of course you're free to bring up some of that subject for questions or discussion. 142 00:22:21.420 --> 00:22:28.420 I'd be happy to provide more than enough detailed information about all that. 143 00:22:28.420 --> 00:22:33.420 So how does economics illuminate the Civil War? 144 00:22:33.420 --> 00:22:50.420 Well, economics can help us understand politics and commerce. 145 00:22:50.420 --> 00:22:57.420 We open by looking at the whole issue of democracy and war. 146 00:22:57.420 --> 00:23:01.100 That's a pretty important issue. 147 00:23:01.100 --> 00:23:09.980 Today it is assumed that democracy is something that minimizes war. 148 00:23:09.980 --> 00:23:21.740 That if countries are only democratic, that we wouldn't have war and we wouldn't have all sorts of problems in economies. 149 00:23:21.740 --> 00:23:29.240 But the evidence to support that notion that we all like to uphold is less than satisfactory. 150 00:23:29.240 --> 00:23:42.140 Actually, if we take a serious look at war and democracy versus dictatorship or kings or monarchy or confederations or other forms of government, 151 00:23:42.140 --> 00:23:51.540 we find that wars actually are very much associated with democracies, and democracies often, very often go to war. 152 00:23:51.540 --> 00:23:59.700 and that most of the major wars are between democracies and so when we look at the cause of 153 00:23:59.700 --> 00:24:10.820 war one of the things that we want to be very cognizant of is democracy itself not as something 154 00:24:10.820 --> 00:24:18.420 that prevents war but something that actually can lead to war and the civil war is a good 155 00:24:18.420 --> 00:24:24.780 illustration of this because it's very often assumed that the mechanism of 156 00:24:24.780 --> 00:24:32.980 democracy of the antebellum period is one that pitted one side against another, a 157 00:24:32.980 --> 00:24:38.020 mechanism that couldn't handle the tremendous pressures that had built up 158 00:24:38.020 --> 00:24:45.100 in American society and ultimately failed to prevent both secession on the 159 00:24:45.100 --> 00:24:53.420 Part of the South and War Between North and South. There's also an ideological sea change that's 160 00:24:53.420 --> 00:25:06.180 going to be going on during the Civil War. The sort of transference of ideology from one that 161 00:25:06.180 --> 00:25:20.300 can be sort of give a shorthand symbolization of it one of Jeffersonian philosophy where our country 162 00:25:20.300 --> 00:25:32.380 was dominated by individualism, state's rights, laissez-faire, limited government, those sorts 163 00:25:32.380 --> 00:25:59.380 A series of notions, not clear-cut obviously, but very much in that direction, very much guided by Jeffersonian principles, but there was always a battle with another ideological viewpoint, which I put under the heading in the book, in several places, of the philosophy of Alexander Hamilton. 164 00:26:02.380 --> 00:26:32.380 and these two philosophies were battling one another and continue to battle one another but in the Civil War basically what you see is a transference of dominance from Jeffersonian to Hamiltonian and with the Hamiltonian point of view you have much less emphasis on states rights and more emphasis on 165 00:26:32.380 --> 00:26:36.680 on the National State. 166 00:26:36.680 --> 00:26:44.260 You have much less emphasis on individualism and more emphasis on government regulation 167 00:26:44.260 --> 00:26:52.260 of the economy, where individuals do not regulate their behavior through markets, but the government 168 00:26:52.260 --> 00:27:22.220 plays an important role in controlling everything in terms of the economy and with Hamilton, you have an activist economic policy, national currencies, national debt, central banks or a national bank, industrial policy, so it's a much more aggressive, more centralized philosophy, 169 00:27:22.260 --> 00:27:30.700 of Society, and the Civil War creates a sea change in the United States in which the Jeffersonian 170 00:27:30.700 --> 00:27:38.380 point of view is displaced as the majority view by the Hamiltonian philosophy. 171 00:27:38.380 --> 00:27:42.920 The monetary system changes dramatically at this point too. 172 00:27:42.920 --> 00:27:50.300 Before the Civil War, the American monetary system was basically gold and silver coins. 173 00:27:50.300 --> 00:27:57.980 People made exchanges either through barter or with gold and silver coins and banks were 174 00:27:57.980 --> 00:28:04.900 unregulated by the federal government at all and very few states placed much restrictions 175 00:28:04.900 --> 00:28:13.020 on banks and there was a lot of distrust of banks especially when they issued paper money. 176 00:28:13.020 --> 00:28:18.100 Jefferson for example said that we shouldn't trust the banks, you might use them but you 177 00:28:18.100 --> 00:28:20.100 and we don't trust them. 178 00:28:20.100 --> 00:28:25.100 With Hamilton and the post-war monetary system, that changes dramatically. 179 00:28:25.100 --> 00:28:30.100 The National Banking Act was passed during the war in 1863, 180 00:28:30.100 --> 00:28:37.100 and we've had paper money, government-issued paper money basically ever since. 181 00:28:37.100 --> 00:28:41.100 We've had a government debt as a result of the Civil War, 182 00:28:41.100 --> 00:28:47.100 and of course that national debt has continued on through time, 183 00:28:47.100 --> 00:28:53.100 The Federal Reserve, fiat money, fractional reserve banking, Human Action, Man Economy and State, The Theory of Money and Credit 184 00:29:17.100 --> 00:29:27.500 News, but we just use it, it's very effective, we have cash and we have checks and we have 185 00:29:27.500 --> 00:29:32.740 credit cards and debit cards and ATM cards, but it's really the system through which 186 00:29:32.740 --> 00:29:39.140 we all communicate and make exchanges in the economy, it's a very, very important institution 187 00:29:39.140 --> 00:29:47.380 in Society, and that institution changed fundamentally with the Civil War. 188 00:29:47.380 --> 00:29:54.580 The whole organization of government in this country changed radically with the Civil War. 189 00:29:54.580 --> 00:30:02.100 Before the war, the country was generally guarded, guided, excuse me, by states' rights. 190 00:30:02.100 --> 00:30:08.500 The state governments were really the level of government at which most government activity 191 00:30:08.500 --> 00:30:17.580 took place. Your average person in Auburn in the antebellum period might not ever come 192 00:30:17.580 --> 00:30:25.740 across a federal employee during their entire lives except the postman, would never even 193 00:30:25.740 --> 00:30:34.580 ever see a federal employee. So that was the type of system of government we had. And then 194 00:30:34.580 --> 00:30:40.380 Then after the war, of course, the national government becomes much more prominent. 195 00:30:40.380 --> 00:30:47.420 States' rights issues before the war, very important, were tariffs and, of course, slavery. 196 00:30:47.420 --> 00:30:50.620 But states had rights before the Civil War. 197 00:30:50.620 --> 00:30:54.500 They were the controlling level of government. 198 00:30:54.500 --> 00:30:58.540 After the war, there was, of course, no right of secession. 199 00:30:58.540 --> 00:31:03.540 The United States gradually became simply branch offices of the federal government. 200 00:31:05.540 --> 00:31:17.540 Some aspects of the Bill of Rights really no longer apply in some sense that the, for example, the 14th Amendment sort of outrules Amendments 9 and 10. 201 00:31:17.540 --> 00:31:35.540 and that we now have become, we've gone from a nation of states to really one very powerful state, in matter of fact the most powerful government in the world by a great margin. 202 00:31:35.540 --> 00:31:42.540 Now, are there any historians in the audience? 203 00:31:42.540 --> 00:32:09.540 Well, it is a very dangerous and very touchy aspect of this book, making bold claims about the power of economics, but it's not meant to put down historians or history in any form or fashion. 204 00:32:09.540 --> 00:32:27.540 Both Bob and I are big readers. We both very much enjoy reading history and reading good historians or watching movies or TV programs about history. 205 00:32:27.540 --> 00:32:34.540 We have the greatest admiration for historians and we have good friends who are historians. 206 00:32:34.540 --> 00:32:58.540 But we do draw a line. Historians and history, we feel, have a comparative advantage in describing history, of actually describing events, of digging up the details, of painting the pictures, and of telling the stories. And we consider that very important. 207 00:32:58.540 --> 00:33:10.540 What about Malcolm Ludwig's statement, history is the propaganda of the victor? 208 00:33:28.540 --> 00:33:38.100 through all of the various theories about history and put forth an hypothesis about how things 209 00:33:38.100 --> 00:33:48.060 occurred in a scientific way that can be examined and debated, but I think it brings up that 210 00:33:48.060 --> 00:33:54.860 issue because I think that quote is absolutely right, that history is written by the victors 211 00:33:54.860 --> 00:34:03.940 and that we need to be very critical of historians, very critical of history. 212 00:34:03.940 --> 00:34:14.380 We have to be very wary that historians are encouraged to be the cheerleaders of the victors 213 00:34:14.380 --> 00:34:21.380 so that whoever wins a war or whoever is in power at any one point in time, historians 214 00:34:21.380 --> 00:34:29.140 Students have a tendency to be very favorable to those people, those rulers, those leaders, 215 00:34:29.140 --> 00:34:32.900 those armies, those states. 216 00:34:32.900 --> 00:34:41.260 And that only when someone becomes out of favor or who is discredited or who is found 217 00:34:41.260 --> 00:34:47.740 to have been doing something wrong like Richard Nixon, well it's okay to criticize Richard 218 00:34:47.740 --> 00:34:54.140 of Nixon because he's been discredited. But, you know, that's different. You're talking 219 00:34:54.140 --> 00:35:01.380 about an American president. It's very difficult for an American historian to write critically 220 00:35:01.380 --> 00:35:08.140 and negatively about that person and achieve any degree of success. Certainly possible, 221 00:35:08.140 --> 00:35:15.140 but the overriding influence you correctly suggest is that history is written by the 222 00:35:15.140 --> 00:35:21.260 Victors. Well, history has a comparative advantage in describing history. We feel 223 00:35:21.260 --> 00:35:27.340 that economics has a comparative advantage in explaining history and I 224 00:35:27.340 --> 00:35:37.740 want to go into that in a little bit of detail. History is just one damn thing 225 00:35:37.740 --> 00:36:07.740 after another. But it's a series of events that could be described as a series of cause and effect events, where every event has a cause, a decision maker, and all the influences that come in on that decision maker. But these cause and effect links are really invisible. You know, we don't have a piece of paper 226 00:36:07.740 --> 00:36:13.380 tell us exactly why George Crispin organized this class. We can't see it. 227 00:36:13.380 --> 00:36:19.500 It's not written on his jacket or on his forehead, but we can still investigate 228 00:36:19.500 --> 00:36:26.020 what caused George to do that. But essentially the cause is invisible. We 229 00:36:26.020 --> 00:36:31.100 have to find some other way to discern what that cause is. Behind every 230 00:36:31.100 --> 00:36:38.540 Every explanation of historical events rests a theory about what that cause is. 231 00:36:38.540 --> 00:36:46.060 How to connect these events in a cause and effect chain of events. 232 00:36:46.060 --> 00:36:50.940 But all of these theories can be right or wrong. 233 00:36:50.940 --> 00:36:58.260 For example, if people on a particular day start carrying umbrellas around and later 234 00:36:58.260 --> 00:37:05.620 around the day it rains, does the fact that people carried umbrellas cause it to rain? 235 00:37:05.620 --> 00:37:15.820 No, absolutely. It's not the umbrellas that cause it to rain, in other words. So there, 236 00:37:15.820 --> 00:37:22.140 you know, you can have the theory that umbrellas cause it to rain is wrong. We can analyze 237 00:37:52.140 --> 00:38:17.140 and only one correct one. I would suggest that the idea that larger armies always cause victory, in this case the Union armies were larger than the Confederate armies and this caused victory, is an incorrect one and it's not sustained by historical evidence. 238 00:38:17.140 --> 00:38:24.140 How about the Greeks at Marathon? The version is far outnumbered. So it's strategy and all kinds of factors in there. 239 00:38:47.140 --> 00:38:56.020 with fewer resources can beat a larger, more prepared, more supplied army. 240 00:38:56.020 --> 00:39:04.620 So that's not going to give us a theory that we can easily apply in all cases. 241 00:39:04.620 --> 00:39:12.140 And economics is going to focus in on rationality, money as well, but we will not ignore things 242 00:39:12.140 --> 00:39:17.500 Things like ideology, ideas, patriotism, etc. 243 00:39:17.500 --> 00:39:23.820 Another example about this cause and effect is, take for example the case of Ireland, 244 00:39:23.820 --> 00:39:31.620 a country that has gone from really the worst economy in Europe to be one of the best performing 245 00:39:31.620 --> 00:39:37.580 economies in Europe, one where the standard of living is now higher than in Great Britain, 246 00:39:37.580 --> 00:39:59.580 which didn't seem possible at all in the past, you know, is that the result of A, tax cuts, B, declining church attendance or C, increases in rugby teams and you know, I think if we look at the tax cut, 247 00:39:59.580 --> 00:40:11.080 The economic motive to explain why the economy grows, we find a very consistent theory of why Ireland has become so successful. 248 00:40:11.080 --> 00:40:26.580 So, we are going to hit on the issue of slavery in this class, but what we're going to find ultimately that in contrast to the currently perceived view 249 00:40:26.580 --> 00:40:33.980 that slavery caused the war, that it was really the most important sole cause of the war, 250 00:40:33.980 --> 00:40:42.380 that that really does not hold up too well to investigation. 251 00:40:42.380 --> 00:40:44.180 It did play a role. 252 00:40:44.180 --> 00:40:50.880 It was obviously, slavery was obviously intermingled in economic issues. 253 00:40:50.880 --> 00:41:01.880 It was of primary importance to the southern economy, to the plantation economy, to the cotton economy, and there was no slavery in the northern states. 254 00:41:01.880 --> 00:41:09.680 So there's a definite dividing line there that slavery causes. 255 00:41:09.680 --> 00:41:15.880 But let's just take a couple of aspects of this problem. 256 00:41:15.880 --> 00:41:25.280 First of all, slavery was gotten rid of or emancipations occurred throughout the Western hemisphere. 257 00:41:25.280 --> 00:41:33.580 Dozens and dozens and dozens of countries got rid of slavery both before and after the American Civil War. 258 00:41:33.580 --> 00:41:41.880 And in no other case did it really require the type of military option that was used in the United States. 259 00:41:41.880 --> 00:41:54.880 So if slavery was the cause of our civil war, why didn't it cause all of these other countries to melt down into civil wars? 260 00:41:54.880 --> 00:42:04.080 So if we look backwards in time, we find that, you know, emancipating slavery doesn't seem to match up too well with civil wars. 261 00:42:04.080 --> 00:42:34.080 And if we look at all the other civil wars that have occurred, we find a couple scholars, Paul Collier and Enki Hoffler, this is reported in the book, they looked at all of the other civil wars that have taken place in history, most of which had taken place after the American Civil War in the 20th century, and they looked at all of the economic statistics in those countries to try to find out what circumstances were likely 262 00:42:34.080 --> 00:42:39.080 The Theory of Money and Credit 263 00:42:39.080 --> 00:42:44.080 The Theory of Money and Credit 264 00:43:04.080 --> 00:43:09.880 Where it's produced in the country, but not consumed in the country, it's sent abroad. 265 00:43:09.880 --> 00:43:17.700 So things like oil, for example, or mineral resources, where the resources are fixed, 266 00:43:17.700 --> 00:43:23.640 they can't be moved around, but they produce products which are used for export in order 267 00:43:23.640 --> 00:43:28.640 to obtain money or imports. 268 00:43:28.640 --> 00:43:35.200 In countries where they had that situation, there was a higher probability of civil war, 269 00:43:35.200 --> 00:43:40.600 which basically, they concluded, was a fight for tradable resources, and a lot of these 270 00:43:40.600 --> 00:43:45.840 civil wars took place in Africa, the ones that they studied, and they found that countries 271 00:43:45.840 --> 00:43:52.280 with lots of mineral resources, lots of oil resources, and farmland that produced products 272 00:43:52.280 --> 00:44:00.840 for Export Markets were the ones that were most likely to find themselves in the Civil War. 273 00:44:00.840 --> 00:44:04.240 And we quote them in the introduction, quote, 274 00:44:04.240 --> 00:44:12.560 We interpret this as being due to the taxable base of the economy constituting an attraction for rebels 275 00:44:12.560 --> 00:44:17.000 wishing to capture the state. 276 00:44:17.000 --> 00:44:23.320 And we find that basically their description is very similar to what existed in the United States. 277 00:44:23.320 --> 00:44:32.080 The big economic base of tradable, exportable products in the U.S. was in the South. 278 00:44:32.080 --> 00:44:43.280 The South produced cotton, tobacco for export in exchange for gold, which we used to pay for other foreign products. 279 00:44:43.280 --> 00:44:49.580 So it was a source of wealth. It wasn't something you lived on the land and you produced for yourself. 280 00:44:49.580 --> 00:44:55.680 This was something you could produce and sell for something else. You could tax it in the process. 281 00:44:55.680 --> 00:45:08.780 And so they found that not only that sort of situation, but that situations where greed caused the Civil War to start 282 00:45:08.780 --> 00:45:17.780 Provided much better explanation than of grievances between races and tribes and ethnic groups. 283 00:45:17.780 --> 00:45:24.780 That the greed for resources was essentially much more important. 284 00:45:24.780 --> 00:45:32.780 The economic aspects of the question were much more important than racial or tribal or ethnic differences. 285 00:45:32.780 --> 00:45:42.780 The colonial period, the immigration was just from Europe through to all of the colonies up and down the coast. 286 00:45:42.780 --> 00:45:52.780 Now after the nation is established and we get into the antebellum period, there's a diminished flow of immigrants into the south. 287 00:45:52.780 --> 00:46:04.780 In the south, there is an increased immigration into the north, and then that pattern actually accelerates after the war. 288 00:46:04.780 --> 00:46:14.780 After the war, everybody basically is immigrating into the north, where there's more manufacturing jobs and things of that nature. 289 00:46:14.780 --> 00:46:21.280 And getting away from the oppression in Europe, in other words, the constriction and all that stuff. 290 00:46:44.780 --> 00:46:54.780 I mean, there are exceptions to this. For example, there's a lot of German and Nordic-type immigration into Texas through this period. 291 00:46:54.780 --> 00:47:04.780 But there is a drift of southern population to the north and northwest. 292 00:47:04.780 --> 00:47:12.780 My own research indicates that my family actually probably entered the country in Virginia and went Pennsylvania to New York, 293 00:47:12.780 --> 00:47:37.780 Although that's not certain, at least on one side of the family. So, as we get into the antebellum period, the population of the North and Northwest is, if you combine those two regions, is going to be much larger than the South, if you include both free and slave populations. 294 00:47:37.780 --> 00:47:44.980 And there's a lot of interesting aspects about the composition. 295 00:47:44.980 --> 00:47:50.340 The northern population was more diverse in the sense of coming from more areas of the 296 00:47:50.340 --> 00:48:02.140 European continent, where the south tended to be dominated by the British islands, Ireland, 297 00:48:02.140 --> 00:48:32.140 in the United States, in Scotland, Britain, and of course the slave population from Africa, so it was more homogeneous, a more homogeneous population, and the wages, the wages, there tended to be a competitive balance, so that the population would move north, south, east and west, and of course southerners were moving west, from, you know, you got the South Carolina, 298 00:48:32.140 --> 00:49:02.140 Georgia immigrants and then they move into the new southwest which is Alabama and Mississippi and then, well in Texas and then Louisiana territory opens up and Tennessee, Western Tennessee and Arkansas opens up and so there's a gradual diffusion of the population and a lot of that goes with opportunities for land and differences in wage rates 299 00:49:02.140 --> 00:49:12.700 And actually the wage rates were a little higher in much of the South, but... 300 00:49:12.700 --> 00:49:18.220 Because they had less, the population was less because of the war, the casualties of 301 00:49:18.220 --> 00:49:19.220 the war? 302 00:49:19.220 --> 00:49:20.220 I mean... 303 00:49:20.220 --> 00:49:21.700 No, this is a lead up to the war. 304 00:49:21.700 --> 00:49:24.700 Oh, you were talking about hand-in-hand. 305 00:49:24.700 --> 00:49:25.700 Yeah. 306 00:49:25.700 --> 00:49:36.380 The southern economy was, of course, mostly agriculture, mostly for export. 307 00:49:36.380 --> 00:49:42.260 As a matter of fact, the south really didn't produce 100% of its food stuffs. 308 00:49:42.260 --> 00:49:49.180 There was importing food and grain from the northwest down the Mississippi and from Tennessee 309 00:49:49.180 --> 00:49:50.420 into Alabama. 310 00:49:50.420 --> 00:50:07.420 The South was really a one-crop thing. England supported the South because they cut off the continent and all their machines, textiles would be put out of business. 311 00:50:07.420 --> 00:50:22.120 I mean, didn't they, in other words, supply, for instance, built the cruiser Alabama and supplied muskets and all that stuff? 312 00:50:22.120 --> 00:50:35.120 And I was thinking about the then secretary of the fellow that became the president of the Confederacy in the years before the war. 313 00:50:35.120 --> 00:51:03.120 He was the Secretary of War, and he saw to it, looking forward to the war, he saw to it that he even imported camels and things for the southwest deserts, and he also, I don't know if this is absolutely true, but I think that the history that I read is that he provided for the coast in the south, 314 00:51:03.120 --> 00:51:19.120 And the things that they purchased, even from the North, for what they envisaged as the Southern Army, was done by him. 315 00:51:33.120 --> 00:51:54.120 in Mississippi and was secretary of war before the war. I do believe you're right. I do believe he had a big impact, a big input in terms of building the coastal forts of the south, big grandiose projects. 316 00:51:54.120 --> 00:52:11.680 What I was saying, though, is that he, before the war, he was in the states' rights, in other words, these Southerners, I can't think of the name, the guy from South Carolina, the firebrand from South Carolina, 317 00:52:11.680 --> 00:52:12.680 John Calhoun? 318 00:52:12.680 --> 00:52:41.680 Calhoun and Jefferson Davis and those people were state rights men and well they ought to be because I mean you look after your state overall, when you look at the state and the nation state, you should be concerned with your own state and I think that that's one of the reasons that these people, 319 00:52:41.680 --> 00:52:59.680 They weren't hotheads in that sense. They were looking forward, like any decent guy, towards the good of the country, not the federal, but the state. 320 00:52:59.680 --> 00:53:23.680 And that, again, you had strong-willed people, and whenever anybody thinks, you take two forces, two countries, and I think Churchill said that the trouble with keeping the peace is that if one nation thinks they have a chance to win, 321 00:53:23.680 --> 00:53:33.680 They're much more willing to jump in there on the other guys than if they just, they think well no, I don't think we could take these guys. 322 00:53:53.680 --> 00:53:56.240 At that time, we were appointed by the state legislators. 323 00:53:56.240 --> 00:53:59.680 They were not voted on by the people in a democratic process. 324 00:53:59.680 --> 00:54:05.040 It was representative government where the senators were representing their states and 325 00:54:05.040 --> 00:54:07.720 their state legislators. 326 00:54:07.720 --> 00:54:13.040 And so that's another reason why senators in general, both north and south, were much 327 00:54:13.040 --> 00:54:18.720 better, or much stronger in terms of states' rights position. 328 00:54:18.720 --> 00:54:27.640 And Calhoun also is an important illustration of the fact that the states' rights issues, 329 00:54:27.640 --> 00:54:31.000 one of the most important ones was the tariff. 330 00:54:31.000 --> 00:54:37.840 The tariff in the United States was basically the sole source of financing for the federal 331 00:54:37.840 --> 00:54:41.920 government to pay for those forts, to pay for the soldiers, to pay for operations in 332 00:54:41.920 --> 00:55:04.920 The Central Government had charge of the tariffs? The states couldn't set their own tariffs? 333 00:55:11.920 --> 00:55:41.920 of the States to set their own tariffs. It established a free trade zone in the United States so that there were no internal trade barriers. It was a free trade zone. But externally, the Constitution prevented taxes on exports, but it did not prevent taxes on imports. Given all of those constraints, the U.S. government financed itself with those tariffs on imports. 334 00:55:41.920 --> 00:56:09.920 And that became really the pivotal issue. That's why South Carolina was threatening to secede, why Calhoun was so up in arms was because of the tariff of abominations where the federal government threatened and did raise the tariff rate to a much higher level and we're going to get to the economics and some of the technical aspects of how this works out. 335 00:56:39.920 --> 00:56:40.920 Unfairly. 336 00:57:09.920 --> 00:57:17.920 The Southerners would have to pay to buy high-priced Yankee products rather than lower-priced European products. 337 00:57:17.920 --> 00:57:27.920 In an indirect way, they were called upon to pay for the vast bulk of Federal expenditures, 338 00:57:27.920 --> 00:57:31.920 most of which they felt were actually occurring up north. 339 00:57:31.920 --> 00:58:01.920 in the North, and there's good evidence that that probably was the case, that except for these forts that were being built around the southern coast, most of the expenditures would actually be happening in the North, or at least the bulk of them, so that, yeah, I mean, there's much more to, you know, this thing called states' rights, it actually, you know, is going to focus on particular issues, 340 00:58:01.920 --> 00:58:07.720 And the power of what goes on in the federal government, those two senators that each state 341 00:58:07.720 --> 00:58:16.640 have is going to become a pivotal issue leading up to, during the antebellum period, to the 342 00:58:16.640 --> 00:58:17.640 Civil War itself. 343 00:58:17.640 --> 00:58:18.640 One more thing. 344 00:58:18.640 --> 00:58:25.640 Why were they building all these forts around the perimeter, the coast and so forth? 345 00:58:25.640 --> 00:58:30.640 I mean, what enemy did they have to fear? 346 00:58:30.640 --> 00:58:43.640 That's another thing. It's been done many times. Build unnecessary things so that you can get profit from the cost of these things. 347 00:59:00.640 --> 00:59:19.640 The Austrian Prince came over and took over Mexico, I mean he was offered, you know, the... 348 00:59:19.640 --> 00:59:20.640 Yes, Jack. 349 00:59:20.640 --> 00:59:26.640 I'm a big believer in economics as being a primary fundamental cause of conflict. 350 00:59:26.640 --> 00:59:35.640 I'm wondering if we are going to get into the question of leadership as causes for the war, 351 00:59:35.640 --> 00:59:43.640 not only southern leadership in various states, but leadership in certain northern states, 352 00:59:43.640 --> 01:00:05.800 Well I mean that's you know that's got to be part of the the overall calculus of 353 01:00:05.800 --> 01:00:11.720 how things worked out. The typical democratic calculus that we are used to 354 01:00:11.720 --> 01:00:21.720 The biggest issue in this country is two major parties battling it out with roughly equal sizes, having to make compromises, and so forth. 355 01:00:21.720 --> 01:00:34.720 And as we go into the end of the Bellum period to the war, all those ties start to break down a little bit. 356 01:00:34.720 --> 01:00:37.720 And you have the emergence of the Republican Party. 357 01:00:37.720 --> 01:00:54.220 You know, the Southern Democratic leaders are often criticized for seceding from the United States of, you know, why did they secede when nothing had actually happened yet? 358 01:00:54.220 --> 01:01:00.220 You know, that Lincoln had been elected and that the Republicans were in control up north, 359 01:01:00.220 --> 01:01:12.220 But much of what they were hoping to do couldn't have been done if the Democrats from the South just simply stayed and did not secede. 360 01:01:12.220 --> 01:01:22.220 But on the other hand, you have, you know, in the North, you have the Republicans, which would be considered radical Republicans, 361 01:01:22.220 --> 01:01:48.220 in the sense that they were looking for a radical departure from the status quo, that they had a fundamental different view as a party of the way the United States should be reconstructed, and I'm not referring to reconstruction itself, then had existed. 362 01:01:48.220 --> 01:02:10.220 And to underline that point, what we must remember is that those political factions and those political leaders from their party were coming together in the Republican Party from a variety of what otherwise might be considered fringe groups. 363 01:02:10.220 --> 01:02:39.220 So that you had the Know-Nothing Party, which was anti-immigrant, pro-free land for Americans, you had the Prohibitionist Party, which was against alcohol, you had the radical emancipation movement, you had the Whig Party, which wanted a big extension of government, 364 01:02:39.220 --> 01:02:49.220 of a central bank, of paper money, of public projects like intercontinental railroads and canals and things of that nature. 365 01:02:49.220 --> 01:03:01.220 And so these were things that were sort of boiling and festering below the surface that weren't really part of federal policy. 366 01:03:01.220 --> 01:03:30.920 And as we come into the war, all of these fringe groups come together as the Republicans, emerge surprisingly victorious, and rather than offsetting them in Congress, the Democrats from the South simply withdraw into secession, leaving them, leaving the Republican coalition as, you know, as an unstoppable force in Congress. 367 01:03:30.920 --> 01:03:32.920 The Republican Party. 368 01:04:00.920 --> 01:04:11.240 are leaders, which we see, Lincoln, his cabinet, his cabinet was probably even more, in some 369 01:04:11.240 --> 01:04:17.480 sense more radical than Lincoln himself, and the leadership of Congress and the leadership 370 01:04:17.480 --> 01:04:25.880 of the Senate, and so, you know, there's a, it's a real big change in leadership when 371 01:04:25.880 --> 01:04:36.440 When you go from before the election in 1860 to inauguration in the following year, the 372 01:04:36.440 --> 01:04:39.240 picture changes very dramatically. 373 01:04:39.240 --> 01:05:09.200 The slave and free states coming into the Union, the violence of power there, before that occurred, about equal, and to maintain the power structure of the South, they had to have those slave states, but why couldn't they, using the power that they had of the Congress, 374 01:05:09.240 --> 01:05:16.240 to prevent a lot of the things that were done outside of the slavery issue. 375 01:05:39.240 --> 01:06:01.240 between North and South and you also have the issue of slavery which has caused a dividing line between the states and the agreement basically is that if we admit a free state that we have to admit simultaneously a slave state so to keep that competitive balance in the Senate. 376 01:06:01.240 --> 01:06:08.160 Now why is that important? Well that is important because through time these 377 01:06:08.160 --> 01:06:12.120 economic interests have been well defined. It wasn't you know in the 378 01:06:12.120 --> 01:06:17.560 beginning of the country Americans up and down the coast a lot of economic 379 01:06:17.560 --> 01:06:21.120 similarities even though they come from different ethnic and religious groups. 380 01:06:21.120 --> 01:06:27.560 Well over time those economic interests become divided in the sense the south 381 01:06:27.560 --> 01:06:39.560 The North becomes this staple export-based economy, the North becomes an economy of industry, agriculture and commerce. 382 01:06:39.560 --> 01:06:46.560 Okay, now demographically what's happening is that the South has always dominated the nation politically. 383 01:06:46.560 --> 01:06:49.560 The South has always dominated the presidency. 384 01:06:49.560 --> 01:07:17.560 The South, for a long time, had a majority in the Senate, and they had a seniority in the Senate, and a balance in the House of Representatives, and they also tended to have a, because they controlled the presidency in many votes, in many elections, they also tended to have a balance of power on the Supreme Court. 385 01:07:17.560 --> 01:07:47.560 Well, as we get up to 1860, this population movement into the North and the diffusion of population in the South and the fact that, of course, the slave population would have made any difference, but they weren't counted as full citizens in all of these, counting for House of Representatives seats, and so the South is getting to be a minority of the voting population, so its prospects for winning the presidency aren't that good. 386 01:07:47.560 --> 01:07:55.560 It's prospects in the House mean that there's more representatives in the North than there is in the South. 387 01:07:55.560 --> 01:08:03.560 And so the Senate, you know, and of course, eventually, as there were more Yankee presidents, 388 01:08:03.560 --> 01:08:08.560 the Supreme Court would become dominated, as it did, by Northerners. 389 01:08:08.560 --> 01:08:14.560 So that the Senate was the last line of veto for federal policy. 390 01:08:14.560 --> 01:08:27.560 And if the North ever got an advantage in the Senate, then the South could be, economic policy could be ramrodded through that would adversely affect the South. 391 01:08:27.560 --> 01:08:33.560 And so that's why you had to have this free and slave state agreement. 392 01:08:33.560 --> 01:08:45.560 And of course, I think a lot of the Southern leaders didn't feel that the Republican government, 393 01:08:45.560 --> 01:08:52.560 that the Republican party was going to stick to that agreement because as part of their coalition, 394 01:08:52.560 --> 01:09:00.560 they had, you know, important members of their coalition included the groups that wanted to emancipate the slaves, 395 01:09:00.560 --> 01:09:07.560 The Free Land for Free Men, The Homestead Act 396 01:09:30.560 --> 01:09:38.560 And the thing itself was another negative for the southern economy, I'm thinking it was the competition, the economic. 397 01:10:00.560 --> 01:10:15.560 which generated income, right, and if it's generating income and then the Republicans come in and want to give it away, that hurts the land value for Southerners as well as Northerners, but it also means that there's less money going into Federal coffers. 398 01:10:15.560 --> 01:10:26.560 that hurts the land value for southerners as well as northerners, but it also means that there's less money going into federal coffers. 399 01:10:26.560 --> 01:10:34.560 Land sales was not a big factor in the overall federal budget, but it was probably the third largest source of federal revenue. 400 01:10:34.560 --> 01:10:46.560 The Southerners wanted a tariff on imports for revenues plus land sales to finance the Federal Government. 401 01:10:46.560 --> 01:10:52.560 The Republicans wanted no land sales and a very high tariff. 402 01:10:52.560 --> 01:11:20.560 and the Lincoln and the supporters of Henry Clay, for example, wanted not just the tariff to provide for all the federal revenue, they wanted it to be even more protective, so they wanted to raise the rate even higher than would be necessary to finance all federal expenditures. 403 01:11:20.560 --> 01:11:22.560 What are they going to do with the extra money? 404 01:11:22.560 --> 01:11:25.560 Well, they don't really care about the extra money for the federal government. 405 01:11:25.560 --> 01:11:31.560 They'll always find a new fort to build, or they'll always find a new canal to construct, 406 01:11:31.560 --> 01:11:36.560 or a new building in Washington D.C., or whatever it happens to be. 407 01:11:36.560 --> 01:11:40.560 They were big for public projects, so if there was extra money around, 408 01:11:40.560 --> 01:11:44.560 they could always spend it on something. 409 01:11:44.560 --> 01:11:49.560 Washington D.C. hasn't changed that much, the more money, the merrier. 410 01:11:49.560 --> 01:11:57.400 and so and plus if you raise those tariffs higher higher like on if you 411 01:11:57.400 --> 01:12:02.960 raise the tariff on steel higher than was necessary to finance government well 412 01:12:02.960 --> 01:12:08.960 that would mean that foreign steel would be more expensive and therefore domestic 413 01:12:08.960 --> 01:12:16.200 steel could you know if you were selling cast-iron skillets you could raise your 414 01:12:16.200 --> 01:12:46.200 Raise Price, because the British had to raise their price, or if you were selling axes, you know, you could raise your price, and so the supporters of Henry Clay in what's called his American system, they wanted, you know, government money, paper money, government debt, they wanted public roads, public works projects, they wanted 415 01:12:46.200 --> 01:13:11.200 and the government regulation of the economy and they wanted protectionism for domestic industry which they perceived as providing immediate tangible results to those industries and that was the American system and so that was really the economic divide between north and south and there weren't really very many southern protectionists. 416 01:13:11.200 --> 01:13:16.400 There were free traders in the north, but there weren't a whole lot of protectionists in the south, 417 01:13:17.240 --> 01:13:19.440 because there wasn't as much industry in the south. 418 01:13:20.800 --> 01:13:22.640 The... 419 01:13:22.640 --> 01:13:29.720 Now sugar was protected by tariffs. So Louisiana had some sugar protectionists. 420 01:13:30.000 --> 01:13:35.800 We've been protecting sugar from the very beginning. We've been paying through the nose or rather through the mouth 421 01:13:37.160 --> 01:13:40.800 for the entire history of this country. We've been paying, I think we now pay 422 01:13:41.200 --> 01:13:47.520 Like five times the world price of sugar to sweeten our coffee so there were some 423 01:13:47.520 --> 01:13:52.080 you know these broad generalizations about Jeffersonian, Hamiltonian philosophy 424 01:13:52.080 --> 01:13:57.520 America is way too diverse to say every northerner was this and every southerner was that 425 01:13:57.520 --> 01:14:06.240 there's a great vast diversity of opinion but it's just when you're talking about a significant 426 01:14:06.240 --> 01:14:13.240 Minority and a Significant Majority.