It was All About Taxes…

Posted on March 21, 2011 by

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There is a TV spot discussing the causes of the Civil War recently introduced in some localities.   The Georgia Division of the Sons of Confederate Veterans created the ad and it is one of twelve running.  Thus far the only place I’ve seen a web copy of the ad is on Facebook (here).  While those on Facebook can view this, those non-socializing members of the internet community might have trouble getting there.  (If you know of a copy of it on YouTube or other site, please let me know).

The ad takes the well-worn path proclaiming the Civil War was about tariffs.  No surprise there.  So what, you say, that’s been debunked already right?  The argument advanced in the ad is built upon the premise that the South (with about 25% of the population) paid 87% of the taxes… er… tariffs before the Civil War.  The twist here is not that southern leaders were hot over the tariffs, but that southerners were tired of paying an unfair share of taxes, and thus rebelled.

Something just doesn’t sound right there.  Think about the nature of tariff collection.  Only imports are subject to tariffs, not exports.  So don’t go thinking that was cotton money.  And agents collect those tariffs at the port of entry.  So where did imports enter the US during those antibellum years?  No surprise – New York.

The statistics pushed by the New York Chamber of Commerce (so take it with a grain of salt) claim two-thirds of all goods entering the US came through Gotham :

Yes, if you go with those figures then the port of New York actually ran a trade deficit – receiving more than it sent out – in terms of dollars.  As for the actual collection of tariffs, the Chamber offered these stats:

So 73% of all goods on which tariffs were collected in 1858-59 passed through New York.

Sure, I’d rather have an actual Treasury statement indicating this breakdown.  So if you are aware of concrete data, not filtered through the New York businessmen, I’m all ears.  Still this matches with cited figures that New York handled about 70% of the nation’s overseas trade in 1860 (followed distantly by Boston then New Orleans).  So if you really want to discuss where the customs officials collected the tariff money, New York was the goose laying the golden egg.

The New York Chamber also provided a lengthy list of items which processed through the port “duty free” and the value of those items on which duties were collected.   Of note, coffee and tea were tax exempt.  In terms of dollar value, the tariff controlled items that passed through New York in the largest volume was wool cloth products – to the tune of $29 million worth of it.  Other tariff controlled commodities of note included silk cloth at $22 million, brown sugar at $19 million, whole cotton cloth at $13 million, rawhide and skins at $8.5 million, flax cloth at $8 million, tobacco at $3.5 million, and various forms of raw iron at about $3.5 million total.  In short, eight products make up over half of the taxable imports.

Now we all know that the enterprising folks who imported those goods didn’t just eat the cost of the tariff.  They passed along that cost to the consumer as they do today.  But who was the consumer?  Who wore more wool products – the people of Charleston, South Carolina or Chicago, Illinois?  What about consumption of brown sugar, were southerners more inclined to have a sweet tooth?  And are we to believe only ladies in Natchez favored silk lace?

Further, some of the tariff targets actually helped the southerners.  Certainly a tariff on tobacco appeared favorable to southern farmers.  And, while I don’t know for sure, I suppose J.R. Anderson (Tredegar Foundry) and Junius L. Archer (Bellona Foundry) in Richmond preferred a tariff on English pig and railroad iron.

Railroad iron… oh, all those improvements the tariff money paid for?  I would point out that a third or so of the Federal budget in 1860 went to the War and Navy Departments.  What were those departments spending money on?  Garrison troops (of which a substantial portion were in the south and west), navy yard maintenance, and seacoast fort improvements.  And yes Fort Sumter was among those improvements.   I’ll save detailed analysis for another day, as it deserves close examination.

The line that “the south paid 87% of the taxes” attempts to redirect the audience from the central issue of slavery.  But I also think the the line about unfair taxation aims to strike a cord with the current mood of the country.  So is the SCV looking to sip some of that duty free tea here?