Although both the North and the South thought
they would easily win the Civil War, the South was in many ways
doomed from the start. Indeed, by 1864 the
South was in ruins, its economy destroyed by blockade, hyperinflation,
and the North’s campaign of total warfare. In the end, it was the
Northern economy and deficiencies in the Southern political system
that won and lost the war.
When war broke out in 1861,
both sides thought they would win quickly and easily. The Union
had experience and international recognition, a robust industrial
economy, a strong federal government, twice the population of the
South, and twice as many young men for its army. On the other hand,
the new Confederacy had cotton (which it believed to be superior
to industry), had better military commanders, and believed it could
bring Britain into the war on its side. Just as important, however,
was the South’s feeling of righteousness that followed secession:
Southerners felt they were carrying on the tradition of overthrowing
tyrannous governments that the founding fathers of the United States
had begun. In addition, Southern soldiers, fighting on their home
territory, also had an intense desire to fight to protect their
homes and families.
By the end of 1864,
however, the South lay in ruins, and very little remained of the
once-proud Cotton Kingdom. The price of goods was so high and money
was so worthless that it cost Southerners in some places several
hundred Confederate dollars to buy a single loaf of bread. As a
result, hunger and malnutrition became rampant. In addition, much
of the landscape from Tennessee to Georgia and up to South Carolina
had been razed by General William Tecumseh Sherman’s troops on their
March to the Sea. Many slaves in the South effectively emancipated
themselves by refusing to work and flocking to Union lines in droves.
The North, meanwhile, was in many ways better off in 1864 than
it had been before the war, for the economy had experienced an enormous
boom during the war years and had set the industrial machine into
high gear.
This industrial boom in the North, coupled with the Richmond government’s
inability to provide cohesive leadership, won the war for the Union.
Virtually all the effective measures passed by the Union government
went unanswered by the Confederacy. Congress in Washington, D.C.,
for example, stabilized the Northern economy early on in the war
by passing the Legal Tender Act, replacing the hundreds of different
state and private bank currencies with a single federal dollar.
Because this “greenback” currency was supported by the U.S. Treasury,
investors knew it was safe and reliable. The National Banking Act
also gave the federal government unprecedented control over the
banking system and the economy as a whole. The Confederate government,
on the other hand, dominated by states’ righters, never enacted
any such federal laws but instead continued to reserve most powers
for the individual states. This inaction, combined with the devastating
economic effects of the Union’s naval blockade of the South, left
the Confederate war effort doomed early on.