Civil War Economic Analysis

The idea of the United States being broken into two areas, the North and the South, did not just exist in Civil War. These two areas of the United States were different ever since the colonial days. However, this division grew more distinct in the 1800s due to the North and South’s different economies being affected unequally by rapid economic expansion. The North’s slave-free, industrial economy multiplied while the South’s slave dependent cash crop economy was barely affected by the growth. The new economic development during this time caused cultural and political differences to intensify, creating a rift within the country. Eventually, the North and South grew too far apart, and just like the splitting of an atom, the consequences of the

United States being ripped in half resulted in an explosive force: The Civil War.
In the north, the colonial merchant economy slowly transformed into an economy supported by industry and business when the Embargo Act of 1807 shut down all international trade with Britain and France. The unexpected consequence that came from this was that it increased American industrialization because the country had to rely more on itself and additionally, caused an increase in overland trade. Further down the line, the market revolution was a huge boom to the northern economy because it led to improved transportation, faster communications, and new inventions, which led to an increased amount of trading in the country (Ellis, 14). The Standard Gauge Railroad Trunk Lines made transportation significantly faster and safer because the trunk lines reduced the change of derailment. This would cause more economic activity because not only were the railroads a fast form of transportation but also reliable, meaning that more people could confidently transport their goods. Additionally, the telegraph was the first form of instant communication in the country, which meant that the United States became smaller as news could be spread faster. With the addition of laissez-faire economics, or having no government interference, that developed from the market revolution, a free market economy was born that created competition, boosting the economy even more. As the economy grew, prices went down with the creation of labor specialization because it created small, certain jobs that unskilled workers could do (Ellis, 14). With the introduction of labor specialization, more jobs would have been created so mechanization, such as McCormick’s Reaper, was also created to encourage people to move off their farms and work in factories. The North’s economy boomed because of the Market Revolution, and this would cause its culture and politics to change with it.
The same economic boom that the North witnessed was not the same story in the South. Due to the Era of Good Feelings, America experienced better roads and infrastructure, which led southern and western farmers to shift from yeoman farming to selling their crops for money. This created a cash crop economy that would soon dominate the southern economy and be one of the factors for regional tension in the country. The South’s market agriculture was so successful for them that by 1825, America’s biggest export would be cotton (Ellis, 13) and the South would become the wealthiest states in the nation (Ellis, 16). However, this prosperous economy was built on the backs of people who were considered sub-human. The South was a slave society, which meant that its political, social, and economic society was almost completely dependent on slavery. As for the market revolution, the only significant factory in the South was the Tredegar Iron Works, which only produced 2% of the wealth accumulated by agriculture, meaning that it had some effect on the South, but it was not significant (Ellis, 16).
The differences in the South’s economy from the North cause the South to disdain the North’s industrialization because their economy was slave-free. Many southerners believed that the North’s economy encouraged wage slavery, in that people worked too long for too little pay, and that by abolishing slavery, they would succumb to the same slavery the northerners experienced. Furthermore, the North’s industry led to commercialization, which introduced new consumer products into the market, and led to an increased image of individualism, hard work, and competition in northern society (Ellis, 17). This was the opposite of the South’s communalism and colonial values. The South continued to keep the colonial hierarchy, where the poor folk kept the communal idea of helping others before themselves, and the rich slaveholders supported paternalism. Paternalism led to southerner’s trying to justify slavery through the Positive Good Theory, which stated that African Americans were incapable of leading their own lives.
Although the South held much of the political power in the United States, it was when the North’s economics began influencing the West into allying with them over the South is what shifted the power into the North’s hands.

The North began working with the West to invest in canals, such as the Erie Canal, that would make transportation between the regions faster, which made crops cheaper. The South never participated in this because they were too invested in slaves. Furthermore, the Tariff of Abominations was the first major blow in separating the North and West from the South, as it taxed corn, wheat, and cotton cloth, all of which were grown in the South. This was the first major law passed by the North and the West, and it infuriated the South so much that it nearly caused the Civil War to break out 30 years early (Ellis, 15). This increased tension would lead to even more tensions, going as far as to create conspiracies about the other region, and destroying the likelihood of future compromises, which made the likelihood of the country avoiding war nearly impossible. The Republican Party was monumental in the events leading up to the Civil War because the party was regional and believed in a strong national government that promoted industry and big business, which supported North economy (Ellis, 19). The Republicans also supported abolishing slavery because northerners believed slavery limited opportunities in the free market for whites as well as blacks (Ellis, 19), which horrified those in the South because Republican ideas would decimate their society. Furthermore, the Republicans were a regional party, so the North was able to vote Lincoln into office with no support from the South, which was troublesome for the entire country because now there was a party that did not need to compromise with the South to get its laws passed. The tensions in the United States were explosive at this point and having a party that did not need compromise would be a blow that

ensured the inevitability of the Civil War.
Although slavery is undeniably the main cause of the Civil War, it is clear that the economic differences between the North and South were also a major cause. The North believed in a slave-free, industrial economy and the South believed the opposite, in a cash crop economy dependent on slaves. The differences there are great, but also influenced cultural and political aspects of both regions, leading to tensions impossible to be addressed without war. In the end, the North’s industrial economy prevailed before the war ended, as the South was forced to industrialize so it could make the supplies essential to fight in the war. Once the war was over, the North’s anti-slavery ideas became a reality throughout the entire United States, and the country would slowly mend together again as time progressed.