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More Trouble for the Lincoln Cartel

by Thomas J. DiLorenzo

The majority of academic historians have as their first and foremost goal remaining a member in good standing of their profession. This means never seriously challenging the template of ideas that is closely guarded by the gatekeepers of the profession – the "senior scholars" who edit the journals, make recommendations for jobs and research grants, sit on editorial boards of university presses, review books in the New York Times and other prominent newspapers, and even appear frequently on cable television documentaries. These are people who have built reputations and careers on perpetuating their view of history, and they do all they can to protect their "human capital." "Academic freedom" is not all that it’s cracked up to be.

Consequently, some of the most interesting and worthwhile works of history increasingly come from outside of academe, where researchers and writers are much more free to pursue the truth as they see it without having to kowtow to the petty academic "gatekeepers." The work of Paul Johnson would be a good example, or Gore Vidal, John Steele Gordon, and others. Indeed, when Charles Adams proposed to his former publisher, Simon and Schuster, that he turn the chapter on the "Civil War" from his book, For Good and Evil: The Impact of Taxes on the Course of Civilization into a book, the publisher loved the idea but told him that the "gatekeepers" would not give it a fair hearing, and so they declined. (The book was subsequently published as When in the Course of Human Events: Arguing the Case for Southern Secession, by Rowman and Littlefield).

Nowhere are the "gatekeepers" more zealous than in guarding the Official View of Abraham Lincoln and the War to Prevent Southern Independence. For the Lincoln Myth is the cornerstone of the ideology of the American state, from which flows a steady stream of pelf and perks to the gatekeepers in their role as court historians. That is why they must be especially troubled that yet another "outsider" – this time a New York Times editorialist no less (!) – has written a book that challenges some of the gatekeepers’ Lincoln mythology.

The book is The Great Tax Wars: Lincoln to Wilson – The Fierce Battles Over Money and Power That Transformed the Nation, by Steven R. Weisman. Weisman covered politics, economics, and international affairs for the New York Times for more than 30 years, and is currently one of the paper’s editorial writers. The book is a general (popular) history of the income tax in America beginning in the 1860s, but there are several passages that really stand out with regard to the Lincoln regime. In particular, in discussing southern secession Weisman writes (p. 22):

South Carolina went first. The state’s grievances had been long-standing and not simply focused on slavery. Its major complaint went to the heart of the nation’s finances – tariffs. A generation earlier, South Carolina had provoked a states’ rights crisis over its doctrine that states could "nullify" or override, the national tariff system. The nullification fight in 1832 was actually a tax revolt. It pitted the state’s spokesman, Vice President John C. Calhoun, against President Andrew Jackson. Because tariffs rewarded manufacturers but punished farmers with higher prices on everything they needed – clothing, farm equipment and even essential food products like salt and meats – Calhoun argued that the tariff system was discriminatory and unconstitutional. Calhoun’s antitariff battle was a rebellion against a system seen throughout the South as protecting the producers of the North (emphasis added).

It is clear to Weisman, and to anyone else who briefly studies the antebellum, North-South tariff battles, that tariff exploitation was just as important to South Carolina (and the rest of the South) in 1860 as it was twenty-eight years earlier (See Mark Thornton and Robert B. Ekelund, Jr., Tariffs, Blockades, and Inflation: The Economics of the Civil War). After the sharp recession of 1857, the Republican Party gained enough political momentum to have the U.S. House of Representatives pass the Morrill Tariff, which more than doubled the average tariff rate, during the 1859–60 session, before Lincoln’s election and before any southern state had seceded. It was signed into law two days before Lincoln’s inauguration by President Buchanan, a staunch Pennsylvania protectionist. (Lincoln lobbied vigorously for the bill, telling a Pittsburgh, Pennsylvania audience a few weeks before his inauguration that it was the most important issue facing their congressional representatives, bar none).

To the South the tariff was all cost and no benefit; its manufacturers did not significantly benefit from it, whereas it caused Southern consumers to pay more for hundreds of items. Worse yet, they could not pass on the higher cost of living caused by the tariff to their customers, since they sold some three-fourths of what they produced on fiercely competitive international markets. To add insult to injury, protectionist tariffs that restricted trade left America’s trading partners with less money with which to purchase American exports, especially the cotton and tobacco that was grown in the South. Thus, protectionist tariffs imposed a triple dose of harm to the South, but benefited the North in two ways: it protected Northern manufacturers from competition, allowing them to raise their prices; and most of the money raised by the tariff was being spent in the North. To the South, protectionist tariffs were an unconstitutional instrument of plunder, just as Calhoun argued; to the North they were a convenient instrument with which they could plunder their fellow citizens in the southern states.

Weisman is undoubtedly familiar with the reasons that Jefferson Davis gave for secession in his first inaugural address. The word slavery does not appear in the address, which instead emphasized economic exploitation of the South by the Northern special-interest groups that had become so powerful in Congress.

There can be no cause to doubt that the courage and patriotism of the people of the Confederate States will be found equal to any measure of defence which may be required for their security. Devoted to agricultural pursuits, their chief interest is the export of a commodity required in every manufacturing country [cotton]. Our policy is peace, and the freest trade our necessities will permit. It is alike our interest, and that of all those to whom we would sell and from whom we would buy, that there should be the fewest practicable restrictions upon the interchange of commodities.

The typical approach of academic historians (and many others) is to smear, denigrate, and demonize Jefferson Davis, good little court historians that they are. But Weisman paints a more accurate portrait of Davis, whom he describes as a hero of the Mexican War, former Secretary of War, a U.S. Senator, and "a vigorous exponent of the view that the war was, at its core, not a fight to preserve slavery but a struggle to overthrow an exploitative economic system headquartered in the North" (p. 52).

Moreover, writes Weisman, "There was a great deal of evidence to support Davis’s view of the South as the nation’s stepchild" (p. 52). "The South had to import two-thirds of its clothing and manufactured goods from outside the region, and southerners paid artificially high prices because of the high tariffs.... The South even had to import food…." The North’s economy was based on "a kind of state capitalism of trade barriers, government-sponsored railroads" and "public investment in canals, roads and other infrastructures," paid for in large part with Southern taxes. "Southern resentment of the tariff system propelled the Democratic Party to define itself as the main challenger" to this corrupt, mercantilist system, writes Weisman (p. 53).

This system of "state capitalism" was also called "The American System" by Henry Clay, Abraham Lincoln’s political idol. Lincoln devoted his entire involvement in politics prior to becoming president to pursuing this agenda first as a Whig, then as a Republican. He became the Republican Party nominee precisely because of his long record as a "state capitalist" or mercantilist, just as Jefferson Davis was chosen to lead the South because of his opposition to the same policies.

Some court historians, such as Harry Jaffa and his followers (MacKubin Thomas Owens, Ken Masugi, and Thomas Krannawitter, for example) wrongly state that the statement of this fact – that Northern interest groups were using the apparatus of the state to plunder their fellow citizens – is somehow "Marxist analysis" and should therefore be dismissed. But the Jaffa-ites are ignorant of the long history of the classical liberal or libertarian "class" analysis. Unlike Marxian class analysis, which claims that the working class is exploited by the capitalist class, libertarian class analysis merely recognizes that in any democracy there will inevitably be a collection of interests, which may change in its composition from time to time, that will be the "tax consumers" or net beneficiaries of government intervention, who benefit at the expense of net taxpayers. It has nothing to do with Marx’s bogus class analysis, but focuses instead on the reality of interest-group politics in democracies that has been studied for literally hundreds of years, even before the time of Adam Smith. Indeed, Adam Smith’s Magnus Opus, The Wealth of Nations, was a critique of mercantilist exploitation in the England of his time (1776) and includes a good bit of libertarian class analysis. Nothing could be further from the doctrines of Karl Marx than the writings of Adam Smith, but the Jaffa-ites are completely ignorant of this difference.

The Northern political regime was clearly fearful of the free-trade doctrines of Adam Smith in 1860, so fearful that some Northern newspapers that were affiliated with the Republican Party advocated the bombing of southern ports before Fort Sumter because of their understanding that the new Confederate Constitution had outlawed protectionist tariffs altogether. With a 33%–50% tariff in the U.S. and a modest 10% tariff rate in the Confederacy, much of the trade of the world would have been diverted to the Southern ports, and this was not to be tolerated.
The Newark [N.J.] Daily Advertiser, which was a Republican Party mouthpiece, warned on April 2, 1861, that the "free-trade doctrines of Adam Smith" were dangerously popular in the South as southerners had "taken to their bosoms the liberal and popular doctrine of free trade" and that they "might be willing to go . . . toward free trade with the European powers." This "must operate to the serious disadvantage of the North," as "commerce will be largely diverted to the Southern cities." And, "We apprehend that the chief instigator of the present troubles – South Carolina – have all along for years been preparing the way for the adoption of free trade." This must be stopped, the New Jersey paper editorialized, by "the closing of the [Southern] ports" by military force (see Howard C. Perkins, Northern Editorials on Secession, p. 601). This of course is exactly what Lincoln set out do to, two weeks after Fort Sumter, in announcing a naval blockade of the South. In doing so he offered the nation one reason and one reason only for the blockade: tariff collection.

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