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Reconstruction: The Battle Not Yet Won
A crucial battle: the Reconstruction of the U.S. South

Fredric W. Henderson


    Around the world today, there is a crying need for a program of economic reconstruction. The newly created nations in Europe, like those of the former Yugoslavia; the continents of Africa, Asia, and Ibero-America which have been devastated by the genocidal economic policies of the International Monetary Fund; and the former Soviet Union, which is now facing uncontrollable chaos, must not merely survive, but must be able to develop and contribute to the betterment of their own peoples and of humanity in general.

    The issues posed today are the same as those that faced President Abraham Lincoln and the congressmen and senators who came to be known as the "radical Republicans" at the outset of Lincoln's second term. Although Lincoln was assassinated in April 1865, before he could fully elaborate and carry out a program of economic reconstruction for the South, the radical Republicans were spurred to continue the fight. They were led by the great nineteenth-century economist Henry C. Carey, who conceived of the fight to rebuild America's South as part of a global war against the imperial policies of Great Britain then being brutally implemented in India and which had dominated the cotton-based economy of the U.S. South. Carey's principal ally in the U.S. Congress was the unflappable, uncompromising congressman from Pennsylvania, Thaddeus Stevens, who led his allies in the Republican Party in defining the nature of the work to be completed in the South. Stevens refused to back down from what he knew to be the principles which would complete this second American Revolution, by developing in the South an economic system based on free labor, and expanding infrastructural and industrial development in that sadly underdeveloped region of the country.

    Today, Carey and Stevens's names are practically unknown; yet they were the two who best understood that their battle was not against a bunch of "unreconstructed" Southerners, but against the economic parasitism of Great Britain.


- Reconstruction: a yardstick for the nation -

    The broader outlines of the battles waged during this period have been masterfully described by W. Allen Salisbury in his book {The Civil War and the American System: America's Battle with Britain 1860-1876} (New York: Campaigner Publications, 1978). To him, for that work soon to be reprinted, all of mankind is indebted. However, there are also key aspects of the battles in Congress that are essential to fully understanding this period.

    All historical debate about what occurred following the U.S. Civil War, has centered on the efforts of the so-called radicals in the Republican Party to assure through Reconstruction a solid Republican South to maintain their political control over the nation. Such issues as black suffrage, disenfranchisement, and the exclusion of former Confederate officials from holding office after the Civil War, have become the yardstick by which the motivations of postwar congressional leaders are measured.

    This misses the essential point: How Reconstruction policy for the South was defined, would be critical to what types of policies would prevail nationally. There can be no question that such leaders as Carey, Stevens, Congressman "Pig Iron" Kelley of Pennsylvania, and Senator Benjamin Wade of Ohio saw the Reconstruction of the South as the economic, political, and social battleground that it was. But their object was broader, for they also viewed Reconstruction as the completion of the American Revolution: It was to be the means to eliminate the influence and control of British power in America. A South rebuilt along the lines of the American System of political economy would serve, along with the West, Midwest, and Mid-Atlantic, as an irresistible force against the New York and New England centers of British-allied financial power and economic, social, and political doctrine. The transformation of the South, which before the war had accepted British free-trade policies with open arms, into a prosperous region within the Union, based on American System economic development measures, would have helped to bankrupt British-allied financial power in the United States, and with it, Britain.

    The opposing faction, committed to British free-trade economic doctrines and British "liberal" political dogma, included President Andrew Johnson, Treasury Secretary Hugh McCulloch, Secretary of State William Seward, "transcendental" Senator Charles Sumner of Massachusetts, Congressmen James Garfield and George Julian, and August Belmont and his pro-British, Pro-Confederate Democratic Party. They were committed to the sabotage of Reconstruction, which would, in turn, create an unbreakable stranglehold over the nation through an alliance of the New York and New England banking interests with an unreconstructed South.

    The battle between these two factions, which would determine the policy direction for the United States to the present day, raged during the years 1865-68 and culminated in a dramatic attempt to impeach President Andrew Johnson; this was a failed effort which can only be described as an attempted constitutional coup d'etat by the American System wing of the Republican Party, in a bid to restore those policies of the war years that had been wiped away with Lincoln's assassination and Johnson's subsequent traitorous sabotage of both Reconstruction and national economic policy.

    For these reasons, it is important to accurately describe how this battle was waged, and why it was lost.


- Carey and Stevens define the issues -


    From 1865 to 1868, Stevens, Carey, and their allies hammered away at what they saw as the crucial issues the United States had to face if it was to throw off the yoke of foreign political and financial control of the nation: protection of U.S. domestic industries, confiscation of the large Southern plantations and their redistribution in the form of family-sized farms, defense of the nation's currency and credit, and, much like today, dealing with the massive national deficit created by the Civil War.

    Carey's most direct and powerful address on the issue of Reconstruction came in the form of his August 1867 pamphlet "Reconstruction: Industrial, Financial, and Political; Letters to the Hon. Henry Wilson." Carey timed his publication of the pamphlet with Congress's passage of the first of the Reconstruction Acts. He directed himself to Wilson because Wilson was a leading "radical" Republican of a distinctly pro-British, pro-free-trade stripe. Wilson was also a U.S. senator from Massachusetts who, along with Charles Sumner, had been instrumental in compromising congressional Reconstruction because of these pro-free-trade views. Wilson and Sumner believed that cotton, which was Britain's hook into the U.S. economy, should remain king in the South, and that the newly freed slaves should remain agricultural field hands. For them, all that had changed was that 4 million slaves were now free. Their pro-British bent was preventing any fundamental change in the feudal economic character of the South from being implemented.

    Carey's pamphlet thus was designed to address Wilson and Sumner's fundamental error with respect to the issues of Reconstruction. "British policy," warned Carey, "looks to arrest the circulation of the world by means of compelling all raw materials produced to pass through its little workshop. It is a monopoly system, and therefore it is that poverty, disease, and famine, all of which unite for the production of slavery, are chronic diseases in every country wholly subjected to British influence."

    "Therefore, too, has it been that British agents have been always in such close alliance with the slave-holding aristocracy of the South; and that throughout the late war, British public opinion has been so nearly universally on the side of the men who have publicly proclaimed that slavery was to be regarded as the proper corner-stone of all free institutions."

    "British free trade, industrial monopoly, and human slavery travel together, and the man who undertakes the work of reconstruction without having first satisfied himself that such is certainly the fact, will find that he has been building on shifting sands, {and must fail to produce an edifice that will be permanent}" (emphasis added).

    In the remaining 14 letters, Carey outlined how British policy had created the slave-based economy of the South, and how, for 30-odd years, the battle over whether such British economic and political policies would prevail nationally had been at the center of the fight to shape America's future. He then made clear that the result of the dominance of such British measures was the root of secession, and that it had been Britain's use of its allies and agents, North and South, that had provoked the conflict of 1861 in an effort to relegate the United States to a grouping of "independent" but impotent satrapies, easily exploited by British power.

    If those policies prevailed after the war, Carey warned, the victory over Southern secession would be meaningless: America would be torn apart by the very same forces that had provoked the conflict in 1860-61.


- Free trade vs. the American System -


    This view, which was also held by Stevens, Kelley, Wade, and their allies, was central to Stevens's proposal for confiscation and redistribution of the former large plantation holdings in the South, and the development of Southern economic resources. Stevens considered confiscation the most important component of any policy imposed by Congress, as an issue which separated the free traders in the Republican Party from the defenders of the American System of political economy which had successfully been re-established during Lincoln's presidency. Sumner, Seward, Treasury Secretary McCulloch, Johnson, and the influential, liberal {New York Tribune} editor Horace Greeley cringed at the idea of dirigist economic development in the South. The Reconstruction legislation proposed by Stevens was not merely opposed to free trade, but was meant to enforce an economic outlook consistent with, and essential to, the fulfillment of the principles of political and civil equality, which were at the center of the battle over political reconstruction--i.e., the full return of the Southern states into the Union.

    Carey, Stevens, and their allies found themselves opposed on these economic questions--on the real core of Reconstruction measures--by this grouping of pro-British free traders and radical abolitionists. Sumner and his cronies within the Republican Party purported to fight for political and social reform in the South, while stripping the nation of economic measures implemented under wartime pressures--measures that had made the abolition of slavery and the defeat of the Confederacy possible. They thus became, along with the still Pro-British, pro-Confederate wing of the Democratic Party controlled by August Belmont and his friends, the most powerful allies of the very Southern slave system they had so violently attacked before the war--ironically, thus ensuring that the root causes for such a system would never be eliminated from the South.


- Protection of U.S. industries -


    After the war, advocates of free trade, both North and South, Democratic and Republican, wished to use the issue of the U.S. war debt, in conjunction with efforts at specie resumption, tariff reduction, and currency contraction, to subvert American economic policy and power. One of the goals of the free traders was the elimination of the wartime protective tariff. A second was the refinancing and repayment of the national debt in specie (gold), as opposed to U.S. currency (greenbacks). These measures, if accomplished, would enable the New York and British financial houses to subvert American economic power. This was a continuation of America's ongoing fight to control its financial institutions and to direct its economic development, rather than succumb to foreign, primarily British, economic domination.

    Sen. Benjamin Wade of Ohio made this point clear in a speech he gave in favor of the Tariff Bill of 1866, urging the Senate to put off no longer what he considered a critical measure for fostering the development of industry in the South as well as the rest of the nation. Wade began with reference to his own state, noting that in Ohio, "what few manufactories we have are in their infancy and free trade would annihilate them at a blow." Wade pointed out that without a tariff during the Civil War, the war "would have been a failure and your bonds would have been no better than confederate bonds today if you had no tariff. Your paper [money] would have been multiplied endlessly, and would be worth nothing. It was your tariff that upheld it. It is your tariff that by encouraging American labor must keep your specie from going out of the country. There is no other way to do it."

    Asked Wade, "Why does Great Britain send her emissaries here preaching free trade all the time, subsidizing presses to advocate it, hiring traveling agents to preach it, expending millions to pervert our minds on the subject? Why, sir, her people were the most highly protected on the face of the earth, until encouraging her own labor and building up her own manufactures she had acquired the monopoly of manufactures throughout the world by the very process of protection; and when she stood so high, with her machinery all perfect, her wealth infinite and ready to annihilate any infant establishment, then, for the same reasons that she had secured the exclusive manufactures of the world by protection, she preaches now free trade, that she may keep that monopoly and prevent other nations from growing up and manufacturing to vie with her.... Besides ...most of her croaking about free trade is perfect hypocrisy; for if you look at her tariff today it is more protective than ours."

    Wade pleaded, "I hope we shall not be guiled by this song of free trade from across the ocean. 'Take no counsel of your enemies' is the first lesson of war. She teaches that to us, and it ought to be a beacon to warn us off the coast. She never teaches anything for our advantage knowingly; for a more selfish nation never existed on the face of God's earth, nor a more tyrannical one, nor one that grinds down the face of the poor with such remorseless energy as does Great Britain."

    Thaddeus Stevens added his voice to Wade's during these same debates by pointing out that "All those free-trade doctrines that are now located along the Mississippi were some years ago further located down South. I had hoped that they were expunged from the free industrial manufacturing North, but I was mistaken. Whatever else the secessionists took with them, I am very sorry they did not take all their relics of free-trade doctrine with them. But it seems they did not; a little of the seed is left."

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