The Civil War’s overall impact on the US economy has been hotly debated since the early consensus that it provided a fundamental spur to industrialization was drawn into question in the 1960s. The effect of the war’s biggest economic reform, the elimination of slavery, was muted by the postbellum quasi-enslavement of millions of free persons in systems of sharecropping and debt peonage that further exacerbated the South’s relative economic backwardness. And while the war effort certainly aided industries that produced military supplies, like the clothing and camp equipage listed in the accompanying monthly return, other industries not closely linked to the war effort suffered.
Documents such as these also highlight the Union’s tremendous material advantage over the Confederacy. When the war began, the Union retained 71% of the nation’s population and railroad mileage, 65% of its farmland, and a whopping 92% of its manufacturing workers and manufacturing output. It also controlled the majority of the nation’s pack animals and steamboats. Just as importantly, the North possessed most of the nation’s financial system, including the majority of its banks and insurance companies and, in New York, Philadelphia, Boston and Chicago, its most important securities markets (derivatives, foreign exchange, stocks and bonds). So what it did not already have it could buy abroad or finance new factories to build.
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Memo from President Abraham Lincoln to Secretary of the Treasury Salmon P. Chase listing assets Lincoln wanted converted into bonds.
Bond issued to Abraham Lincoln featuring his portrait, 1864. Courtesy of the Bureau of the Public Debt.