"Dear Sir: Yours of the 1st instant received prompt attention,

and I am led to the conclusion that some imposition has been

practiced upon you. The Secretary of War informs me that he has

not granted leaves of absence or furloughs to soldiers of your

command for a month past, and then only to divert the current

which threatened by legislation to destroy your army by a

wholesale system of furloughs. Those which you inform me are

daily received must be spurious. The authority to reënlist and

change from infantry to artillery, the Secretary informs me, has

been given but in four cases--three on the recommendation of

General Beauregard, and specially explained to you some time

since; the remaining case was that of a company from Wheeling,

which was regarded as an exceptional one. I wish, therefore,

that you would send to the Adjutant-General the cases of recent

date in which the discipline of your troops has been interfered

with in the two methods stated, so that an inquiry may be made

into the origin of the papers presented. The law in relation to

reënlistment provides for reorganization, and was under the

policy of electing the officers.

"The concession to army opinions was limited to the promotion by

seniority after the organization of the companies and regiments

had been completed. The reorganization was not to occur before

the expiration of the present term. A subsequent law provides

for filling up the twelve months' companies by recruits for the

war, but the organization ceases with the term of the twelve

months' men. Be assured of readiness to protect your proper

authority, and I do but justice to the Secretary of War in

saying that he can not desire to interfere with the discipline

and organization of your troops. He has complained that his

orders are not executed, and I regret that he was able to

present to me so many instances to justify that complaint, which

were in no wise the invasion of your prerogative as a commander

in the field.

"You can command my attention at all times to any matter

connected with your duties, and I hope that full co-intelligence

will secure full satisfaction. Very truly yours,

"Jefferson Davis."

A fortnight after this letter, I received from General Johnston notice

that his position was considered unsafe. Many of his letters to me have

been lost, and I have thus far not been able to find the one giving the

notice referred to, but the reply which is annexed clearly indicates the

substance of the letter which was answered.

"Richmond, Virginia, _February_ 28, 1862.

"General J. E. Johnston: ... Your opinion that your position may

be turned whenever the enemy chooses to advance, and that he

will be ready to take the field before yourself, clearly

indicates prompt effort to disencumber yourself of everything

which would interfere with your rapid movement when necessary,

and such thorough examination of the country in your rear as

would give you exact knowledge of its roads and general

topography, and enable you to select a line of greater natural

advantages than that now occupied by your forces.

"The heavy guns at Manassas and Evansport, needed elsewhere, and

reported to be useless in their present position, would

necessarily be abandoned in any hasty retreat. I regret that you

find it impossible to move them.

"The subsistence stores should, when removed, be placed in

positions to answer your future wants. Those can not be

determined until you have furnished definite information as to

your plans, especially the line to which you would remove in the

contingency of retiring. The Commissary-General had previously

stopped further shipments to your army, and given satisfactory

reasons for the establishment at Thoroughfare.[191] ...

"I need not urge on your consideration the value to our country

of arms and munitions of war: you know the difficulty with which

we have obtained our small supply; that, to furnish heavy

artillery to the advanced posts, we have exhausted the supplies

here which were designed for the armament of the city defenses.

Whatever can be, should be done to avoid the loss of these

guns....

"As has been my custom, I have only sought to present general

purposes and views. I rely upon your special knowledge and high

ability to effect whatever is practicable in this our hour of

need. Recent disasters have depressed the weak, and are

depriving us of the aid of the wavering. Traitors show the

tendencies heretofore concealed, and the selfish grow clamorous

for local and personal interests. At such an hour, the wisdom of

the trained and the steadiness of the brave possess a double

value. The military paradox that impossibilities must be

rendered possible, had never better occasion for its

application.

"The engineers for whom you asked have been ordered to report to

you, and further additions will be made to your list of

brigadier-generals. Let me hear from you often and fully.

"Very truly and respectfully yours,

"Jefferson Davis."

"Richmond, Virginia, _March_ 6, 1862.

"General J. E. Johnston:... Notwithstanding the threatening

position of the enemy, I infer from your account of the roads

and streams that his active operations must be for some time

delayed, and thus I am permitted to hope that you will be able

to mobilize your army by the removal of your heavy ordnance and

such stores as are not required for active operations, so that,

whenever you are required to move, it may be without public loss

and without impediment to celerity. I was fully impressed with

the difficulties which you presented when discussing the subject

of a change of position. To preserve the efficiency of your

army, you will, of course, avoid all needless exposure; and,

when your army has been relieved of all useless encumbrance, you

can have no occasion to move it while the roads and the weather

are such as would involve serious suffering, because the same

reasons must restrain the operations of the enemy....

"Very respectfully yours,

"Jefferson Davis."

At the conference at Fairfax Court-House, heretofore referred to, I was

sadly disappointed to find that the strength of that army had been

little increased, notwithstanding the reënforcements sent to it since

the 21st of July, and that to make an advance the generals required an

additional force, which it was utterly impracticable for me to supply.

Soon thereafter the army withdrew to Centreville, a better position for

defense but not for attack, and thereby suggestive of the abandonment of

an intention to advance. The subsequent correspondence with General

Johnston during the winter expressed an expectation that the enemy would

resume the offensive, and that the position then held was geographically

unfavorable. There was a general apprehension at Richmond that the

northern frontier of Virginia would be abandoned, and a corresponding

earnestness was exhibited to raise the requisite force to enable our

army to take the offensive. On the 10th of March I telegraphed to

General Johnston: "Further assurance given to me this day that you shall

be promptly and adequately reënforced, so as to enable you to maintain

your position, and resume first policy when the roads will permit." The

first policy was to carry the war beyond our own border.

Five days thereafter, I received notice that our army was in retreat,

and replied as follows:

"Richmond, Virginia, _March_ 15, 1862.

"General J. E. Johnston, _Headquarters Army of the Potomac_.

"General: I have received your letter of the 13th instant,

giving the first official account I have received of the

retrograde movement of your army.

"Your letter would lead me to infer that others had been sent to

apprise me of your plans and movements. If so, they have not

reached me; and, before the receipt of yours of the 13th, I was

as much in the dark as to your purposes, condition, and

necessities as at the time of our conversation on the subject

about a month since.

"It is true I have had many and alarming reports of great

destruction of ammunition, camp-equipage, and provisions,

indicating precipitate retreat; but, having heard of no cause

for such a sudden movement, I was at a loss to believe it.

"I have not the requisite topographical knowledge for the

selection of your new position. I had intended that you should

determine that question; and for this purpose a corps of

engineers was furnished to make a careful examination of the

country to aid you in your decision.

"The question of throwing troops into Richmond is contingent

upon reverses in the West and Southeast. The immediate necessity

for such a movement is not anticipated.

"Very respectfully yours,

"Jefferson Davis."

On the same day I sent the following telegram:

"Richmond, Virginia, _March_ 15, 1862.

"General J. E. Johnston, _Culpepper Court-House, Virginia_.

"Your letter of the 13th received this day, being the first

information of your retrograde movement. I have no report of

your reconnaissance, and can suggest nothing as to the position

you should take except it should be as far in advance as

consistent with your safety.

"Jefferson Davis."

To further inquiry from General Johnston as to where he should take

position, I replied that I would go to his headquarters in the field,

and found him on the south bank of the river, to which he had retired,

in a position possessing great natural advantages. An elevated bank

commanded the north side of the river, overlooking the bridge, and an

open field beyond it, across which the enemy must pass to reach the

bridge, which, if left standing, was an invitation to seek that

crossing. Upon inquiring whether the south bank of the river continued

to command the other side down to Fredericksburg, General Johnston

answered that he did not know; that he had not been at Fredericksburg

since he passed there in a stage on his way to West Point, when he was

first appointed a cadet. I then proposed that we should go to

Fredericksburg, to inform ourselves upon that point. On arriving at

Fredericksburg, a reconnaissance soon manifested that the hills on the

opposite side commanded the town and adjacent river-bank, and therefore

Fredericksburg could only be defended by an army occupying the opposite

hills, for which our force was inadequate. In returning to the house of

Mr. Barton, where I was a guest, I found a number of ladies had

assembled there to welcome me, and who, with anxiety, inquired as to the

result of our reconnaissance. Upon learning that the town was not

considered defensible against an enemy occupying the heights on the

other side, and that our force was not sufficient to hold those heights

against such an attack as might be anticipated, the general answer was,

with a self-sacrificing patriotism too much admired to be forgotten, "If

the good of our cause requires the defense of the town to be abandoned,

let it be done." The purposes of the enemy were then unknown to us. If

General Johnston's expectation of a hostile advance in great force

should be realized, our course must depend partly upon receiving the

reënforcement we had reason to expect from promises previously given and

renewed, as was announced to General Johnston in my telegram of 10th of

March, 1862, in these words:

"Further assurance given to me this day that you shall be

promptly and adequately reënforced, so as to enable you to

maintain your position, and resume first policy when the roads

will permit."

No immediate decision could therefore be made, and I returned to

Richmond, to wait the further development of the enemy's plans, and to

prepare as best we might to counteract them.

The feeling heretofore noticed as arousing in Virginia a determination

to resist the abandonment of her northern frontier, and which caused the

assurance of reënforcements, bore fruit in the addition of about thirty

thousand men, by a draft made by the Governor of the State. These, it is

true, were not the disciplined, seasoned troops which were asked for by

the generals in the conference at Fairfax Court-House, but they were of

such men as often during the war won battles for the Confederacy. The

development of the enemy's plans, for which we had to wait, proved that,

instead of advancing in force against our position at Centreville, he

had, before the retreat of our army commenced, decided to move down the

Potomac for a campaign against Richmond, from the Peninsula as a base.

The conflagration at Centreville gave notice of its evacuation, and an

advance was made as far as Manassas, but, as appears by General

McClellan's report, with no more important design than to attack our

rear guard, if it should be encountered. In the report on the conduct of

the war by a committee of the United States Congress, evidence is found

of much vacillation before the conclusion was finally reached of

abandoning the idea of a direct advance upon Richmond for that of

concentrating their army at the mouth of the Chesapeake. Whatever doubt

or apprehension continued to exist about uncovering the city of

Washington by removing their main army from before it, was of course

dispelled by the retreat of our army, and the burning of bridges behind

it. In this last-mentioned fact, General McClellan says he found the

strongest reason to believe that there was no immediate danger of our

army returning.

There was an apparent advantage to the enemy in the new base for his

operations which was sufficiently illustrated by the events of the last

year of the war. Had we possessed an army as large as the enemy

supposed, it would have been possible for us at the same time to check

his advance from the East and to march against his capital, with fair

prospect of capturing it, before the army he had sent against Yorktown

could have been brought back for the defense of Washington. On this as

on other occasions he greatly magnified the force we possessed, and on

this as on other occasions it required the concentration of our troops

successfully to resist a detachment of his. Accepting as a necessity

the withdrawal of the main portion of our army from northern Virginia to

meet the invasion from the seaboard, it was regretted that earlier and

more effective means were not employed for the mobilization of the army,

a desirable measure in either contingency of advance or retreat, or at

the least that the withdrawal was not so deliberate as to secure the

removal of our ordnance, subsistence, and quartermasters' stores, which

had been collected on the line occupied in 1861 and the early part of

1862.

A distinguished officer of our army, who has since the war made valuable

contributions to the history of its operations--especially valuable as

well for their accuracy as for their freedom from personal or partisan

bias--writes thus of the retreat from Centreville:

"A very large amount of stores and provisions had been abandoned

for want of transportation, and among the stores was a very

large quantity of clothing, blankets etc., which had been

provided by the States south of Virginia for their own troops.

The pile of trunks along the railroad was appalling to behold.

All these stores, clothing, trunks, etc., were consigned to the

flames by a portion of our cavalry left to carry out the work of

their destruction. The loss of stores at this point and at White

Plains on the Manassas Gap Railroad, where a large amount of

meat had been salted and stored, was a very serious one to us,

and embarrassed us for the remainder of the war, as it put us at

once on a running stock."

The same officer--and the value of his opinion will be recognized by all

who know him, wherefore I give his name, General J. A. Early--in a

communication subsequent to that from which I have just quoted, writes,

in regard to the loss of supplies:

"I believe that all might have been carried off from Manassas if

the railroads had been energetically operated. The rolling-stock

of the Orange and Alexandria, Manassas Gap, and Virginia Central

Railroads ought to have been sufficient for the purpose of

removing everything in the two weeks allowed, if properly used."

The enemy's plans, the development of which, as has been already stated,

was necessary for the determination of our own movements, were soon

thereafter found to be the invasion of Virginia from the seaboard, and

the principal portion of our army was consequently ordered to the

Peninsula, between the York River and the James. Thus the northern

frontier of Virginia, which, in the first year of the war, had been the

main field of skirmishes, combats, and battles, of advance and retreat,

and the occupation and evacuation of fortified positions, ceased for a

time to tremble beneath the tread of contending armies.

To the foregoing narration of events immediately connected with the

efforts of the Confederate Government to maintain its existence at home,

may here be properly added an incident bearing on its foreign relations

in the first year of the war.

Our efforts for the recognition of the Confederate States by the

European powers, in 1861, served to make us better known abroad, to

awaken a kindly feeling in our favor, and cause a respectful regard for

the effort we were making to maintain the independence of the States

which Great Britain had recognized, and her people knew to be our

birthright.

On the 8th of November, 1861, an outrage was perpetrated by an armed

vessel of the United States, in the forcible detention, on the

high-seas, of a British mail steamer, making one of her regular trips

from one British port to another, and the seizure, on that unarmed

vessel, of our Commissioners, Mason and Slidell, who with their

secretaries were bound for Europe on diplomatic service. The seizure was

made by an armed force against the protest of the Captain of the vessel,

and of Commander Williams, R.N., the latter speaking as the

representative of her Majesty's Government. The Commissioners only

yielded when force, which they could not resist, was used to remove them

from the mail-steamer, and convey them to the United States vessel of

war.

This outrage was the more marked because the United States had been

foremost in resisting the right of "visit and search," and had made it

the cause of the War of 1812 with Great Britain.

When intelligence of the event was received in England, it excited the

greatest indignation among the people; and her Majesty's Government, by

naval and other preparations, unmistakably exhibited the purpose to

redress the wrong.

The Commissioners and their secretaries had been transported to the

harbor of Boston, and imprisoned in its main fortress.

Diplomatic correspondence resulted from this event. The British

Government demanded the immediate and unconditional release of the

Commissioners, "in order that they may again be placed under British

protection, and a suitable apology for the aggression which has been

committed."

In the mean time, Captain Wilkes, commander of the vessel which had made

the visit and search of the Trent, returned to the United States and was

received with general plaudit, both by the people and the Government.

The House of Representatives passed a vote of thanks, an honor not

heretofore bestowed except for some deed deserving well of the country.

In the midst of all this exultation at the seizure of our Commissioners

on board of a British merchant-ship, came the indignant and stern demand

for the restoration of those Commissioners to the British protection

from which they had been taken, and an apology for the aggression. It

was little to be expected, after such explicit commendation of the act,

that the United States Government would accede to the demand; and

therefore the War and Navy Departments of the British Government made

active and extensive provision to enforce it. The haughty temper

displayed toward four gentlemen arrested on an unarmed ship subsided in

view of a demand to be enforced by the army and navy of Great Britain,

and the United States Secretary of State, after a wordy and ingenious

reply to the Minister of Great Britain at Washington City, wrote: "The

four persons in question are now held in military custody at Fort

Warren, in the State of Massachusetts. They will be cheerfully

liberated. Your lordship will please indicate a time and place for

receiving them."

There was a time when the Government and the people of the United States

would not have sanctioned such aggression on the right of friendly ships

to pass unquestioned on the high way of nations, and the right of a

neutral flag to protect everything not contraband of war; but that was a

time when arrogance and duplicity had not led them into false positions,

and when the roar of the British lion could not make Americans retract

what they had deliberately avowed.

[Footnote 191: Thoroughfare Gap was the point at which the

Commissary-General had placed a meat-packing establishment]

CHAPTER XII.

Supply of Arms at the Beginning of the War; of Powder; of

Batteries; of other Articles.--Contents of Arsenals.--Other

Stores, Mills, etc.--First Efforts to obtain Powder, Niter, and

Sulphur.--Construction of Mills commenced.--Efforts to supply

Arms, Machinery, Field-Artillery, Ammunition, Equipment, and

Saltpeter.--Results in 1862.--Government Powder-Mills; how

organized.--Success.--Efforts to obtain Lead.--

Smelting-Works.--Troops, how armed.--Winter of 1862.--

Supplies.--Niter and Mining Bureau.--Equipment of First

Armies.--Receipts by Blockade-Runners.--Arsenal at

Richmond.--Armories at Richmond and Fayetteville.--A Central

Laboratory built at Macon.--Statement of General Gorgas.--

Northern Charge against General Floyd answered.--Charge of

Slowness against the President answered.--Quantities of Arms

purchased that could not be shipped in 1861.--Letter of Mr.

Huse.

At the beginning of the war the arms within the limits of the

Confederacy were distributed as follows:

Rifles. Muskets.

At Richmond (State) about 4,000

Fayetteville, North Carolina " 2,000 25,000

Charleston, South Carolina " 2,000 20,000

Augusta, Georgia " 3,000 28,000

Mount Vernon, Alabama " 2,000 20,000

Baton Rouge, Louisiana " 2,000 27,000

--------- ----------

Total 15,000 120,000

There were at Richmond about sixty thousand old flint-muskets, and at

Baton Rouge about ten thousand old Hall's rifles and carbines. At Little

Rock, Arkansas, there were a few thousand stands, and a few at the Texas

Arsenal, increasing the aggregate of serviceable arms to about one

hundred and forty-three thousand. Add to these the arms owned by the

several States and by military organizations, and it would make a total

of one hundred and fifty thousand for the use of the armies of the

Confederacy. The rifles were of the caliber .54, known as Mississippi

rifles, except those at Richmond taken from Harper's Ferry, which were

of the new-model caliber .58; the muskets were the old flint lock,

caliber .69, altered to percussion. There were a few boxes of sabers at

each arsenal, and some short artillery-swords. A few hundred

holster-pistols were scattered about. There were no revolvers.

There was before the war little powder or ammunition of any kind stored

in the Southern States, and this was a relic of the war with Mexico. It

is doubtful if there were a million of rounds of small-arms cartridges.

The chief store of powder was that captured at Norfolk; there was,

besides, a small quantity at each of the Southern arsenals, in all sixty

thousand pounds, chiefly old cannon-powder. The percussion-caps did not

exceed one quarter of a million, and there was no lead on hand. There

were no batteries of serviceable field-artillery at the arsenals, but a

few old iron guns mounted on Gribeauval carriages fabricated about 1812.

The States and the volunteer companies did, however, possess some

serviceable batteries. But there were neither harness, saddles, bridles,

blankets, nor other artillery or cavalry equipments.

To furnish one hundred and fifty thousand men, on both sides of the

Mississippi, in May, 1861, there were no infantry accoutrements, no

cavalry arms or equipments, no artillery and, above all, no ammunition;

nothing save arms, and these almost wholly the old pattern smooth-bore

muskets, altered to percussion from flint locks.

Within the limits of the Confederate States the arsenals had been used

only as depots, and no one of them, except that at Fayetteville, North

Carolina, had a single machine above the grade of a foot-lathe. Except

at Harper's Ferry Armory, all the work of preparation of material had

been carried on at the North; not an arm, not a gun, not a gun-carriage,

and, except during the Mexican War, scarcely a round of ammunition, had

for fifty years been prepared in the Confederate States. There were

consequently no workmen, or very few, skilled in these arts. Powder,

save perhaps for blasting, had not been made at the South. No saltpeter

was in store at any Southern point; it was stored wholly at the North.

There were no worked mines of lead except in Virginia, and the situation

of those made them a precarious dependence. The only cannon-foundry

existing was at Richmond. Copper, so necessary for field-artillery and

for percussion-caps, was just being obtained in East Tennessee. There

was no rolling-mill for bar-iron south of Richmond, and but few

blast-furnaces and these, with trifling exceptions, were in the border

States of Virginia and Tennessee.

The first efforts made to obtain powder were by orders sent to the

North, which had been early done both by the Confederate Government and

by some of the States. These were being rapidly filled when the attack

was made on Fort Sumter. The shipments then ceased. Niter was

contemporaneously sought for in north Alabama and Tennessee. Between

four and five hundred tons of sulphur were obtained in New Orleans, at

which place it had been imported for use in the manufacture of sugar.

Preparations for the construction of a large powder-mill were promptly

commenced by the Government, and two small, private mills in East

Tennessee were supervised and improved. On June 1, 1861, there was

probably two hundred and fifty thousand pounds only, chiefly of

cannon-powder, and about as much niter, which had been imported by

Georgia. There were the two powder-mills above mentioned, but we had no

experience in making powder, or in extracting niter from natural

deposits, or in obtaining it by artificial beds.

For the supply of arms an agent was sent to Europe, who made contracts

to the extent of nearly half a million dollars. Some small-arms had been

obtained from the North, and also important machinery. The machinery at

Harper's Ferry Armory had been saved from the flames by the heroic

conduct of the operatives, headed by Mr. Armistead M. Ball, the master

armorer. Of the machinery so saved, that for making rifle-muskets was

transported to Richmond, and that for rifles with sword-bayonets to

Fayetteville, North Carolina. In addition to the injuries suffered by

the machinery, the lack of skilled workmen caused much embarrassment. In

the mean time the manufacture of small-arms was undertaken at New

Orleans and prosecuted with energy, though with limited success.

In field-artillery the manufacture was confined almost entirely to the

Tredegar Works in Richmond. Some castings were made in New Orleans, and

attention was turned to the manufacture of field and siege artillery at

Nashville. A small foundry at Rome, Georgia, was induced to undertake

the casting of the three-inch iron rifle, but the progress was very

slow. The State of Virginia possessed a number of old four-pounder iron

guns which were reamed out to get a good bore, and rifled with three

grooves, after the manner of Parrott. The army at Harper's Ferry and

that at Manassas were supplied with old batteries of six-pounder guns

and twelve-pounder howitzers. A few Parrott guns, purchased by the State

of Virginia, were with General Magruder at Big Bethel.

For the ammunition and equipment required for the infantry and

artillery, a good laboratory and workshop had been established at

Richmond. The arsenals were making preparations for furnishing

ammunition and knapsacks; but generally, what little was done in this

regard was for local purposes. Such was the general condition of

ordnance and ordnance stores in May, 1861.

The progress of development, however, was steady. A refinery of

saltpeter was established near Nashville during the summer, which

received the niter from its vicinity, and from the caves in East and

Middle Tennessee. Some inferior powder was made at two small mills in

South Carolina. North Carolina established a mill near Raleigh; and a

stamping-mill was put up near New Orleans, and powder made there before

the fall of the city. Small quantities were also received through the

blockade. It was estimated that on January 1, 1862, there were fifteen

hundred seacoast-guns of various caliber in position from Evansport, on

the Potomac, to Fort Brown, on the Rio Grande. If their caliber was

averaged at thirty-two pounder, and the charge at five pounds, it would,

at forty rounds per gun, require six hundred thousand pounds of powder

for them. The field-artillery--say three hundred guns, with two hundred

rounds to the piece--would require one hundred and twenty-five thousand

pounds; and the small-arm cartridges--say ten million--would consume one

hundred and twenty-five thousand pounds more, making in all eight

hundred and fifty thousand pounds. Deducting two hundred and fifty

thousand pounds, supposed to be on hand in various shapes, and the

increment is six hundred thousand pounds for the year 1861. Of this,

perhaps two hundred thousand pounds had been made at the Tennessee and

other mills, leaving four hundred thousand pounds to be supplied through

the blockade, or before the beginning of hostilities.

The liability of powder to deteriorate in damp atmospheres results from

the impurity of the niter used in its manufacture, and this it is not

possible to detect by any of the usual tests. Security, therefore, in

the purchase, depends on the reliability of the maker. To us, who had to

rely on foreign products and the open market, this was equivalent to no

security at all. It was, therefore, as well for this reason as because

of the precariousness of thus obtaining the requisite supply, necessary

that we should establish a Government powder-mill. It was our good

fortune to have a valuable man whose military education and scientific

knowledge had been supplemented by practical experience in a large

manufactory of machinery. He, General G. W. Rains, was at the time

resident in the State of New York; but, when his native State, North

Carolina, seceded from the Union and joined the Confederacy, true to the

highest instincts of patriotism, he returned to the land of his birth,

and only asked where he could be most useful. The expectations which his

reputation justified, caused him to be assigned to the task of making a

great powder-mill, which should alike furnish an adequate supply, and

give assurance of its possessing all the requisite qualities. This

problem, which, under the existing circumstances, seemed barely

possible, was fully solved. Not only was powder made of every variety of

grain and exact uniformity in each, but the niter was so absolutely

purified that there was no danger of its deterioration in service. Had

Admiral Semmes been supplied with such powder, it is demonstrated, by

the facts which have since been established, that the engagement between

the Alabama and the Kearsarge would have resulted in a victory for the

former.

These Government powder-mills were located at Augusta, Georgia, and

satisfactory progress was made in the construction during the year. All

the machinery, including the very heavy rollers, was made in the

Confederate States. Contracts were made abroad for the delivery of niter

through the blockade; and, for obtaining it immediately, we resorted to

caves, tobacco-houses, cellars, etc. The amount delivered from Tennessee

was the largest item in the year's supply, but the whole was quite

inadequate to existing and prospective needs.

The consumption of lead was mainly met by the Virginia lead-mines at

Wytheville, the yield from which was from sixty to eighty thousand

pounds per month. Lead was also collected by agents in considerable

quantities throughout the country, and the battle-field of Manassas was

closely gleaned, from which much lead was collected. A laboratory for

the smelting of other ores was constructed at Petersburg, Virginia, and

was in operation before midsummer of 1862.

By the close of 1861, eight arsenals and four depots had been supplied

with materials and machinery, so as to be efficient in producing the

various munitions and equipments, the want of which had caused early

embarrassment. Thus a good deal had been done to produce the needed

material of war, and to refute the croakers who found in our poverty

application for the maxim, "_Ex nihilo nihil fit._"

The troops were, however, still very poorly armed and equipped. The old

smooth-bore musket was the principal weapon of the infantry; the

artillery had mostly the six-pounder gun and the twelve-pounder

howitzer; and the cavalry were armed with such various weapons as they

could get--sabers, horse-pistols, revolvers, Sharp's carbines,

musketoons, short Enfield rifles, Holt's carbines, muskets cut off, etc.

Equipments were in many cases made of stout cotton domestic, stitched in

triple folds and covered with paint or rubber varnish. But, poor as were

the arms, enough of them, such as they were, could not be obtained to

arm the troops pressing forward to defend their homes and their

political rights.

In December, 1861, arms purchased abroad began to come in, and a good

many Enfield rifles were in the hands of the troops at the battle of

Shiloh. The winter of 1862 was the period when our ordnance deficiencies

were most keenly felt. Powder was called for on every hand; and the

equipments most needed were those we were least able to supply. The

abandonment of the line of the Potomac and the upper Mississippi from

Columbus to Memphis did somewhat, however, the pressure for heavy

artillery; and, after the fall of 1862, when the powder-mills at Augusta

had got into full operation, there was no further inability to meet all

requisitions for ammunition. To provide the iron needed for cannon and

projectiles, it had been necessary to stimulate by contracts the mining

and smelting of its ores.

But it was obviously beyond the power of even the great administrative

capacity of the chief of ordnance, General J. Gorgas, to whose monograph

I am indebted for these details, to add, to his already burdensome

labors, the numerous and increasing cares of obtaining the material from

which ammunition, arms, and equipments were to be manufactured. On his

recommendation a niter and mining bureau was organized, and Colonel St.

John, who had been hitherto assigned to duty in connection with

procuring supplies of niter and iron, was appointed to be chief of this

bureau. A large, difficult, and most important field of operations was

thus assigned to him, and well did he fulfill its requirements. To his

recent experience was added scientific knowledge, and to both, untiring,

systematic industry, and his heart's thorough devotion to the cause he

served. The tree is known by its fruit, and he may confidently point to

results as the evidence on which he is willing to stand for judgment.

Briefly, they will be noticed.

Niter was to be obtained from caves and other like sources, and by the

formation of niter-beds, some of which had previously been begun at

Richmond. These beds were located at Columbia, South Carolina,

Charleston, Savannah, Augusta, Mobile, Selma, and various other points.

At the close of 1864 there were two million eight hundred thousand feet

of earth collected, and in various stages of nitrification, of which a

large proportion was presumed to yield one and a half pound of niter per

foot of earth. The whole country was laid off into districts, each of

which was under the charge of an officer, who obtained details of

workmen from the army, and made his monthly reports. Thus the niter

production, in the course of a year, was brought up to something like

half of the total consumption. The district from which the most constant

yield could be relied on had its chief office at Greensboro, North

Carolina, a region which had no niter-caves in it. The niter was

obtained from lixiviation of nitrous earth found under old houses,

barns, etc. The supervision of the production of iron, lead, copper, and

all the minerals which needed development, as well as the manufacture of

sulphuric and nitric acids (the latter required for the supply of the

fulminate of mercury for percussion-caps), without which the firearms of

our day would have been useless, was added to the niter bureau. Such was

the progress that, in a short time, the bureau was aiding or managing

some twenty to thirty furnaces with an annual yield of fifty thousand

tons or more of pig-iron. The lead- and copper-smelting works erected

were sufficient for all wants, and the smelting of zinc of good quality

had been achieved. The chemical works were placed at Charlotte, North

Carolina, to serve as a reserve when the supply from abroad might be cut

off.

In equipping the armies first sent into the field, the supply of

accessories was embarrassingly scant. There were arms, such as they

were, for over one hundred thousand men, but no accoutrements nor

equipments, and a meager supply of ammunition. In time the knapsacks

were supplanted by haversacks, which the women could make. But soldiers'

shoes and cartridge-boxes must be had; leather was also needed for

artillery-harness and for cavalry-saddles; and, as the amount of leather

which the country could furnish was quite insufficient for all these

purposes, it was perforce apportioned among them. Soldiers' shoes were

the prime necessity. Therefore, a scale was established, by which first

shoes and then cartridge-boxes had the preference; after these,

artillery-harness, and then saddles and bridles. To economize leather,

the waist and cartridge-box belts were made of prepared cotton cloth

stitched in stitched in three or four thicknesses. Bridle-reins were

likewise so made, and then cartridge-boxes were thus covered, except the

flap. Saddle-skirts, too, were made of heavy cotton cloth strongly

stitched. To get leather, each department procured its quota of hides,

made contracts with the tanners, obtained hands for them by exemptions

from the army, got transportation over the railroads for the hides and

for supplies. To the varied functions of this bureau was finally added

that of assisting the tanners to procure the necessary supplies for the

tanneries. A fishery, even, was established on Cape Fear River to get

oil for mechanical purposes, and at the same time food for the workmen.

In cavalry equipments the main thing was to get a good saddle which

would not hurt the back of the horse. For this purpose various patterns

were tried, and reasonable success was obtained. One of the most

difficult wants to supply in this branch of the service was the

horseshoe for cavalry and artillery. The want of iron and of skilled

labor was strongly felt. Every wayside blacksmith-shop accessible,

especially those in and near the theatre of operations, was employed.

These, again, had to be supplied with material, and the employees

exempted from service.

It early became manifest that great reliance must be placed on the

introduction of articles of prime necessity through the blockaded ports.

A vessel, capable of stowing six hundred and fifty bales of cotton, was

purchased by the agent in England, and kept running between Bermuda and

Wilmington. Some fifteen to eighteen successive trips were made before

she was captured. Another was added, which was equally successful. These

vessels were long, low, rather narrow, and built for speed. They were

mostly of pale sky-color, and, with their lights out and with fuel that

made little smoke, they ran to and from Wilmington with considerable

regularity. Several others were added, and devoted to bringing in

ordnance, and finally general supplies. Depots of stores were likewise

made at Nassau and Havana. Another organization was also necessary, that

the vessels coming in through the blockade might have their return

cargoes promptly on their arrival These resources were also supplemented

by contracts for supplies brought through Texas from Mexico.

The arsenal in Richmond soon grew into very large dimensions, and

produced all the ordnance stores that the army required, except cannon

and small-arms, in quantities sufficient to supply the forces in the

field. The arsenal at Augusta was very serviceable to the armies serving

in the south and west, and turned out a good deal of field-artillery

complete. The Government powder-mills were entirely successful. The

arsenal and workshops at Charleston were enlarged, steam introduced, and

good work done in various departments. The arsenal at Mount Vernon,

Alabama, was moved to Selma, in that State, where it grew into a large

and well-ordered establishment of the first class. Mount Vernon Arsenal

was dismantled, and served to furnish lumber and timber for use

elsewhere. At Montgomery, shops were kept up for the repair of

small-arms and the manufacture of articles of leather. There were many

other small establishments and depots.

The chief armories were at Richmond and Fayetteville, North Carolina.

The former turned out about fifteen hundred stands per month, and the

latter only four hundred per month, for want of operatives. To meet the

want of cavalry arms, a contract was made for the construction in

Richmond of a factory for Sharp's carbines; this being built, it was

then converted into a manufactory of rifle-carbines, caliber .58.

Smaller establishments grew up at Asheville, North Carolina, and at

Tallahassee, Alabama. A great part of the work of the armories consisted

in the repair of arms. In this manner the gleanings of the battle-fields

were utilized. Nearly ten thousand stands were saved from the field of

Manassas, and from those about Richmond in 1862 about twenty-five

thousand excellent arms. All the stock of inferior arms disappeared from

the armories during the first two years of the war, and were replaced by

a better class of arms, rifled and percussioned. Placing the good arms

lost previous to July, 1863, at one hundred thousand, there must have

been received from various sources four hundred thousand stands of

infantry arms in the first two years of the war.

Among the obvious requirements of a well-regulated service was one

central laboratory of sufficient capacity to prepare all ammunition, and

thus to secure the vital advantage of absolute uniformity. Authority was

therefore granted to concentrate this species of work at Macon, Georgia.

Plans of the buildings and of the machinery required were submitted and

approved, and the work was begun with energy. The pile of buildings had

a façade of six hundred feet, was designed with taste, and comprehended

every possible appliance for good and well-organized work. The buildings

were nearly ready for occupation at the close of the war, and some of

the machinery had arrived at Bermuda. This project preceded that of a

general armory for the Confederacy, and was much nearer completion.

These, with the admirable powder-mills at Augusta, would have been

completed, and with them the Government would have been in a condition

to supply arms and ammunition to three hundred thousand men. To these

would have been added a foundry for heavy guns at Selma or Brierfield,

Alabama, where the strongest cast iron in the country had been made.

Thus has been briefly sketched the development of the resources from

which our large armies were supplied with arms and ammunition, while our

country was invaded on land and water by armies much larger than our

own. It will be seen under what disadvantages our people successfully

prosecuted the (to them) new pursuits of mining and manufacturing. The

chief of ordnance was General J. Gorgas, a man remarkable for his

scientific attainment, for the highest administrative capacity and moral

purity, all crowned by zeal and fidelity to his trust, in which he

achieved results greatly disproportioned to the means at his command. He

closes his excellent monograph in the following words:

"We began in April, 1861, without an arsenal, laboratory, or

powder-mill of any capacity, and with no foundry or

rolling-mill, except in Richmond, and, before the close of 1863,

or within a little over two years, we supplied them. During the

harassments of war, while holding our own in the field defiantly

and successfully against a powerful enemy; crippled by a

depreciated currency; throttled with a blockade that deprived us

of nearly all the means of getting material or workmen; obliged

to send almost every able-bodied man to the field; unable to use

the slave-labor, with which we were abundantly supplied, except

in the most unskilled departments of production; hampered by

want of transportation even of the commonest supplies of food;

with no stock on hand even of articles such as steel, copper,

leather, iron, which we must have to build up our

establishments--against all these obstacles, in spite of all

these deficiencies, we persevered at home, as determinedly as

did our troops in the field, against a more tangible opposition;

and in that short period created, almost literally out of the

ground, foundries and rolling-mills at Selma, Richmond, Atlanta,

and Macon; smelting-works at Petersburg, chemical works at

Charlotte, North Carolina; a powder-mill far superior to any in

the United States and unsurpassed by any across the ocean; and a

chain of arsenals, armories, and laboratories equal in their

capacity and their improved appointments to the best of those in

the United States, stretching link by link from Virginia to

Alabama."

The same officer writes:

"It was a charge often repeated at the North against General

Floyd, that, as Secretary of War, he had with traitorous intent

abused his office by sending arms to the South just before the

secession of the States. The transactions which gave rise to

this accusation were in the ordinary course of an economical

administration of the War Department. After it had been

determined to change the old flint-lock muskets which the United

States possessed to percussion, it was deemed cheaper to bring

all the flint-lock arms in store at Southern arsenals to the

Northern arsenals and armories for alteration, rather than to

send the necessary machinery and workmen to the South.

Consequently, the Southern arsenals were stripped of their

deposits, which were sent to Springfield, Watervliet, Pittsburg,

St. Louis, and other points. After the conversion had been

effected, the denuded Southern arsenals were again supplied with

about the same number, perhaps slightly augmented, that had

formerly been stored there. The quota deposited at the

Charleston Arsenal, where I was stationed in 1860, arrived there

full a year before the opening of the war."

The charge was made early in the war that I was slow in procuring arms

and munitions of war from Europe. We were not only in advance of the

Government of the United States in the markets of Europe, but the facts

presented in the following extracts from a letter of our agent, Caleb

Huse, dated December 30, 1861, and addressed to Major C. C. Anderson,

will serve to place the matter in its proper light:

"London, _December_ 30, 1861.

"Dear Major: We are all waiting with almost breathless anxiety

for the arrival of the answer from the United States to the

unqualified demand of England for the captured commissioners.

Will Mr. Lincoln disregard the international writ of _habeas

corpus_ served by Great Britain? We shall soon know. If the

prisoners are given up, the affair will result in great

inconvenience to us in the way of shipping goods.

"I have now more than enough to load three 'Bermudas,' and can

not ship a package, though I have a steamer off the wharf, all

ready to receive her cargo. We are literally fighting two

governments here. Government watchmen guard the wharf where our

goods are stowed and others in the neighborhood, night and

day--and the wharfinger has orders not to ship or deliver, by

land or water, any goods marked W. D., without first acquainting

the honorable Board of Customs. I have applied myself to ship to

Bermuda, offering to give bonds to double the amount of value of

the goods, that they should be held in Bermuda, subject to the

direction of her Majesty's representative in Bermuda. I ... has

applied for permission to ship to Cardenas, agreeing to hold the

goods subject to the order of the Spanish authorities--but all

without avail, and our army must suffer for the want of

blankets, overcoats, shoes, socks, field forges, arms, and

ammunition, which have been collected to an amount more than

double that I have yet received.

"It is miserable to have to look at the immense pile of packages

in the warehouse at St. Andrews Wharf, and not be able to send

anything--only read the following: twenty-five thousand rifles;

two thousand barrels of powder; five hundred thousand caps; ten

thousand friction-tubes; five hundred thousand cartridges;

thirteen thousand accoutrements; thirteen thousand knapsacks;

thirteen thousand gun-slings; forty-four thousand three hundred

and twenty-eight pairs of socks; sixteen thousand four hundred

and eighty-four blankets; two hundred and twenty-six saddles;

saddlers' tools; artillery-harness; leather, etc. Very truly

yours,

"Caleb Huse."

CHAPTER XIII.

Extracts from my Inaugural.--Our Financial System: Receipts and

Expenditures of the First Year.--Resources, Loans, and

Taxes.--Loans authorized.--Notes and Bonds.--Funding

Notes.--Treasury Notes guaranteed by the States.--Measure to

reduce the Currency.--Operation of the General System.--Currency

fundable.--Taxation.--Popular Aversion.--Compulsory Reduction of

the Currency.--Tax Law.--Successful Result.--Financial Condition

of the Government at its Close.--Sources whence Revenue was

derived.--Total Public Debt.--System of Direct Taxes and

Revenue.--The Tariff.--War-Tax of Fifty Cents on a Hundred

Dollars.--Property subject to it.--Every Resource of the Country

to be reached.--Tax paid by the States mostly.--Obstacle to the

taking of the Census.--The Foreign Debt.--Terms of the

Contract.--Premium.--False charge against me of

Repudiation.--Facts stated.

In my inaugural address in 1862 I said:

"The first year of our history has been the most eventful in the

annals of this continent. A new Government has been established,

and its machinery put in operation over an area exceeding seven

hundred thousand square miles. The great principles upon which

we have been willing to hazard everything that is dear to man,

have made conquests for us which could never have been achieved

by the sword. Our Confederacy has grown from six to thirteen

States; and Maryland, already united to us by hallowed memories

and material interests, will, I believe, when enabled to speak

with unstifled voice, connect her destiny with the South. Our

people have rallied with unexampled unanimity to the support of

the great principles of constitutional government, with firm

resolve to perpetuate by arms the rights which they could not

peacefully secure. A million of men, it is estimated, are now

standing in hostile array and waging war along a frontier of

thousands of miles. Battles have been fought, sieges have been

conducted, and, although the contest is not ended, and the tide

for the moment is against us, the final result in our favor is

not doubtful.... Fellow-citizens, after the struggles of ages

had consecrated the right of the Englishman to constitutional

representative government, our colonial ancestors were forced to

vindicate that birthright by an appeal to arms. Success crowned

their efforts, and they provided for their posterity a peaceful

remedy against future aggression.

"The tyranny of an unbridled majority, the most odious and the

least responsible form of despotism, has denied us both the

right and the remedy. Therefore, we are in arms to renew such

sacrifices as our forefathers made to the holy cause of

constitutional liberty."

The financial system which had been adopted from necessity proved

adequate at this early period to supply all the wants of the Government

and of the people. An unexpected and very large increase of expenditures

had resulted from the great enlargement of the necessary means of

defense. Yet the Government entered on its second year without a

floating debt and with its credit unimpaired. The total expenditures of

the first year, ending February 1, 1862, amounted to one hundred and

seventy million dollars. A statement of the Secretary of the Treasury,

comprising the period from the organization of the Government to August

1, 1862, presents the following results:

Expenditures: War Department $298,376,549 41

Navy " 14,605,777 86

Civil and miscellaneous 15,766,503 43

---------------

Total $328,748,830 70

Outstanding requisitions 18,524,128 15

---------------

Total expenditures 347,272,958 85

Total receipts 302,482,096 60

---------------

Deficient Treasury notes authorized 16,755,165 00

" " " to be provided 28,035,697 25

---------------

$44,790,862 25

The receipts were derived as follows:

Customs $1,437,399 96

War-tax 10,539,910 70

Miscellaneous 1,974,769 33 $13,952,079 99

Loans, bonds, February, 1861 15,000,000 00

Bonds, August, 1861 22,613,346 61

Call certificates, December, 1861 37,515,200 00

Treasury notes, April, 1861 22,799,900 00

Demand notes, August, 1861 187,130,670 00

One and two dollar notes 846,900 00

Due banks 2,645,000 00 $288,551,016 61

---------------

Total receipts $302,503,096 60

Such was the result presented by the Treasury of a Government that had

been in existence only eighteen months. It commenced that existence

without a treasury, and, without the sinews and the munitions of war,

was in less than two months invaded on every side by an implacable foe.

Its ways and means consisted in loans and taxes, and to these it

resorted. On February 28th I was authorized by Congress to borrow, at

any time within twelve months, fifteen million dollars, or less, as

might be needed. It was to be applied to the payment of appropriations

for the support of the Government, and for the public defense.

Certificates of stock or bonds, payable in ten years at eight per cent.

interest, were issued. For the payment of the interest and principal of

this loan a tax or duty of one eighth of one per cent. per pound was

laid on all cotton exported. On March 9th an issue of one million

dollars in Treasury notes of fifty dollars and upward was authorized,

payable in one year from date, at 3.65 per cent. interest, and

receivable for all public debts except the export duty on cotton. A

reissue was authorized for a year. On May 16th a loan of fifty million

dollars in bonds, payable after twenty years at eight per cent.

interest, was authorized. The bonds were "to be sold for specie,

military stores, or for the proceeds of sales of raw produce or

manufactured articles, to be paid in the form of specie or with foreign

bills of exchange." The bonds could not be issued in fractional parts of

a hundred dollars, or be exchanged for Treasury notes or the notes of

any bank, corporation, or individual. In lieu of any amount of these

bonds, not exceeding twenty million dollars, an equal amount of Treasury

notes, without interest, in denominations of five dollars and upward,

was authorized to be issued. These notes were payable in two years in

specie, and were receivable for all debts or taxes except the export

duty on cotton. They were also convertible into bonds payable in ten

years at eight per cent. interest. On August 19th another issue of

Treasury notes, amounting with those then issued to one hundred million

dollars, was authorized. They were of the denominations of five dollars

and upward. They were receivable for the war-tax and all other public

dues except the export duty on cotton. These notes were convertible into

twenty-year bonds, bearing eight per cent. interest, of which the issue

was limited to one hundred million dollars. Thirty millions were to be a

substitute for the same amount, authorized by the act of May 16, 1861.

These bonds could be exchanged for specie, military and naval stores, or

for the proceeds of raw produce and manufactured articles. On December

19th ten million dollars in Treasury notes were issued to pay the

advance of the banks. On December 24th an additional issue of fifty

millions of Treasury notes like those of the act of August 19th was

authorized. An additional issue of thirty millions of bonds was also

authorized. On April 12, 1862, an issue of Treasury notes, certificates

of stock and bonds, as the public necessities might require, to the

amount of two hundred and fifteen millions, was authorized. Of these,

fifty millions in Treasury notes were issued without reserve, ten

millions in Treasury notes retained as a reserve fund to pay any sudden

or unexpected call for deposits, and one hundred and sixty-five millions

certificates of stock or bonds. Bonds to the amount of fifty million

dollars, payable in ten years at six per cent. interest, were authorized

and made exchangeable for any of the above Treasury notes. All these

notes and bonds were subject to the same conditions as those of the acts

of August 19 and December 24, 1861. On April 17th five millions of

Treasury notes were authorized to be issued in denominations of one and

two dollars, which were receivable for all public dues except the cotton

duty. An amount of Treasury notes bearing interest at two cents per day

on each hundred dollars, as a substitute for as much of the one hundred

and sixty-five millions of bonds authorized, was also authorized to be

issued. On September 19, 1862, three million five hundred thousand

dollars in bonds was authorized to be issued to meet a contract for six

iron-clad vessels of war. On September 23, 1862, the amount of Treasury

notes under the denomination of five dollars was increased from five

million to ten million dollars, and a further issue of bonds or

certificates of stock, to the amount of fifty million dollars, was

authorized.

On March 23, 1863, an effort was made to remove from circulation some of

the issues of Treasury notes by funding them. For this purpose it was

provided that all Treasury notes, not bearing interest, issued prior to

December, 1862, should be fundable in eight per cent. bonds or stock

during the ensuing thirty days, and during the succeeding three months

in seven per cent. bonds or stock, after which they ceased to be

fundable. All Treasury notes not bearing interest, and issued after

December 1, 1862, until ten days after the passage of the act, were made

fundable in seven per cent. bonds or stock during the ensuing four

months, and afterward only in four per cent. thirty years bonds. Call

certificates were made fundable in thirty years bonds at eight per

cent., and all outstanding on the ensuing July 1st were deemed bonds at

six per cent., payable in thirty years. A monthly issue of Treasury

notes, without interest, to the amount of fifty million dollars, was

also authorized. These were made fundable during the first year of their

issue in six per cent. thirty years bonds, and after the expiration of

the year in four per cent. thirty years bonds. The further issue of call

certificates was suspended; but Treasury notes fundable in the six per

cent. bonds might be converted, at the pleasure of the holder, into such

certificates at five per cent. interest, which were reconvertible into

like notes within six months, or afterward exchanged for thirty years

six per cent. bonds. Treasury notes fundable in four per cent. bonds

were convertible in like manner at four per cent. All disposable means

in the Treasury were to be applied to the purchase of Treasury notes,

bearing no interest, until the amount in circulation did not exceed one

hundred and seventy-five millions. The issue of five million dollars, in

notes of two dollars, one dollar, and fifty cents, was also authorized.

It was further provided in this act that six per cent. bonds, as above

mentioned, might be sold to any of the States for Treasury notes, and,

being guaranteed by any of the States, they might be used to purchase

Treasury notes. The whole amount of such bonds could not exceed two

hundred million dollars. Treasury notes so purchased were not to be

reissued. The issue of six per cent. coupon bonds to the amount of one

hundred million dollars, which were to be applied only to the absorption

of Treasury notes, was also authorized. The coupons were payable either

in the currency in which interest on other bonds was paid, or in cotton

certificates pledging the Government to pay the same in cotton of New

Orleans middling quality, delivered at the rate of eight pence sterling

per pound.

An important measure was adopted on February 17, 1864, the object of

which was to reduce the currency and to authorize a new issue of notes

and bonds. All Treasury notes above the denomination of five dollars,

and not bearing interest, were, if offered within a short period, made

fundable in registered twenty years bonds at four per cent. At the same

time a new issue of Treasury notes was authorized, and made receivable

for all public dues, except customs duties, at the rate of two dollars

for three of the old. The issue of other Treasury notes, after the 1st

of the ensuing April, was prohibited.

To pay the expenses of the Government an issue of five hundred million

dollars in six per cent. bonds was authorized. For the payment of

interest the receipts of the export and import duties, payable in

specie, were pledged.

A review of this statement of the legislation of Congress will clearly

present the financial system of the Government. The first action of the

Provisional Congress was confined to the adoption of a tariff law, and

an act for a loan of fifteen million dollars, with a pledge of a small

export duty on cotton, to provide for the redemption of the debt. At the

next session, after the commencement of the war, provision was made for

the issue of twenty million dollars in Treasury notes, and for borrowing

thirty million dollars in bonds. At the same time the tariff was

revised, and preparatory measures taken for the levy of internal taxes.

After the purpose of subjugation became manifest by the action of the

Congress of the United States, early in July, 1861, and the certainty of

a long war was demonstrated, there arose the necessity that a financial

system should be devised on a basis sufficiently large for the vast

proportions of the approaching contest. The plan then adopted was

founded on the theory of issuing Treasury notes, convertible at the

pleasure of the holder into eight per cent. bonds, with the interest

payable in coin. It was assumed that any tendency to depreciation, which

might arise from the over-issue of the currency, would be checked by the

constant exercise of the holder's right to fund the notes at a liberal

interest, payable in specie. The success of this system depended on the

ability of the Government constantly to pay the interest in specie. The

measures, therefore, adopted to secure that payment consisted in the

levy of an internal tax, termed a war tax, and the appropriation of the

revenue from imports.

The first operation of this plan was quite successful. The interest was

paid from the reserve of coin existing in the country, and experience

sustained the expectations of those who devised the system.

Wheat, in the beginning of the year 1862, was selling at one dollar and

thirty cents per bushel, thus but little exceeding its average price in

time of peace. The other agricultural products of the country were at

similarly moderate rates, thus indicating that there was no excess of

circulation. At the same time the premium on coin had reached about

twenty per cent. But it had become apparent that the commerce of our

country was threatened with permanent suspension by reason of the

conduct of neutral nations, who virtually gave aid to the United States

Government by sanctioning its declaration of a blockade. These neutral

nations treated our invasion by our former limited and special agent as

though it were the attempt of a sovereign to suppress a rebellion

against lawful authority. This exceptional cause heightened the premium

on specie, because it indicated the exhaustion of our reserve, without

the possibility of renewing the supply.

At the inauguration of the permanent Government, in February, 1862, a

popular aversion to internal taxation had been so strongly manifested as

to indicate its partial failure. This will be further explained

presently in our statement of the system of taxation.

Under all these circumstances the effort was made to avoid the increase

in the volume of notes in circulation, by offering inducements to

voluntary funding. The measures adopted for that purpose were but

partially successful. Meanwhile the intervening exigencies from the

fortunes of war permitted no delay. The issues of Treasury notes were

increased until, in December, 1863, the currency in circulation amounted

to more than six hundred million dollars, or more than threefold the

amount required by the business of the country. The evil effects of this

financial condition were but too apparent. In addition to the difficulty

presented to the necessary operations of the Government, and the

efficient conduct of the war, the most deplorable of all its results

was, undoubtedly, its corrupting influence on the morals of the people.

The possession of large amounts of Treasury notes led to a desire for

investment; and, with a constantly increasing volume of currency, there

was an equally constant increase of price in all objects of investment.

This effect stimulated purchase by the apparent certainty of profit, and

a spirit of speculation was thus fostered, which had so debasing an

influence and such ruinous consequences that it became our highest duty

to remove the cause by prompt and stringent measures.

I therefore recommended to Congress, in December, 1863, the compulsory

reduction of the currency to the amount required by the business of the

country, accompanied by a pledge that, under no stress of circumstances,

would the amount be increased. I stated that, if the currency was not

greatly and promptly reduced, the existing scale of inflated prices

would not only continue, but, by the very fact of the large amounts thus

made requisite in the conduct of the war, these prices would reach rates

still more extravagant, and the whole system would fall under its own

weight, rendering the redemption of the debt impossible, and destroying

its value in the hands of the holder. If, on the contrary, a funded

debt, with interest secured by adequate taxation, could be substituted

for the outstanding currency, its entire amount would be made available

to the holder, and the Government would be in a condition, beyond the

reach of any probable contingency, to prosecute the war to a successful

issue.

This recommendation was followed by the passage of the act of February

17, 1864, above mentioned. One of its features is the tax levied on the

circulation. Regarding the Government when contracting a debt as the

agent of the people, its debt is their debt. As the currency was held

exclusively by ourselves, it was obvious that, if each person, held

Treasury notes in exact proportion to the valuation of his whole estate,

each would in fact owe himself the amount of the notes held by him; and,

were it possible to distribute the currency among the people in this

exact proportion, a tax levied on the currency alone, to an amount

sufficient to reduce it to its proper limits, would afford the best of

all remedies. Under such circumstances, the notes remaining in the hands

of each holder after the payment of his tax would be worth quite as much

as the whole sum previously held, for it would have an equal purchasing

capacity.

After this law had been in operation for one year, it was manifest that

it had the desired effect of withdrawing from circulation the large

excess of Treasury notes which had been issued. On July 1, 1864, the

outstanding amount was estimated at two hundred and thirty million

dollars. The estimate of the amount funded under this act, about this

time, was three hundred million dollars, while new notes were authorized

to be issued to the extent of two thirds of the sum received under its

provisions. The chief difficulty apprehended in connection with our

finances, up to the close of the war, resulted from the depreciation of

our Treasury notes, which was to be attributed to the increasing

redundancy in amount and the diminishing confidence in their ultimate

redemption.

The financial condition of the Government, near its close, is very

correctly represented in the report of the Treasury Department. The

total receipts of the Treasury for the two quarters ending on September

30, 1864, amounted to $415,191,550, which sum, added to the balance,

$308,282,722, that remained in the Treasury on April 1, 1864, formed a

total of $723,474,272. Of this total, not far from half, that is to say,

$342,560,327, were applied to the extinction of the public debt; while

the total expenditures were $272,378,505, leaving a balance in the

Treasury on October 1, 1864, of $108,435,440. The sources from which

this revenue was derived were as follows:

Four per cent. registered bonds,

act of February 17, 1864 $13,363,500

Six per cent. bonds, $500,000,000 loan,

act of February 17, 1864 14,481,050

Four per cent. call certificates,

act of February 17, 1864 20,978,100

Tax on old issue of certificates redeemed $14,440,566

Repayments by disbursing officers 20,115,830

Treasury notes, act of February 17, 1864 277,576,950

War-tax 42,294,314

Sequestrations 1,338,732

Customs 50,004

Export duty 4,320

Coin seized by the Secretary of War 1,653,200

Premium on loans 4,822,249

Soldiers' tax 908,622

The total amount of the public debt on October 1, 1864, on the books of

the Register of the Treasury, was $1,147,970,208, of which $530,340,090

were funded debt, bearing interest, and $283,880,150 were Treasury notes

of the new issue, and the remainder consisted of the former issue of

Treasury notes which were converted into other forms of debt, and ceased

to exist on December 31st. In consequence, however, of the absence of

certain returns from distant officers, the true amount of the debt was

less by $21,500,000 than appeared on the books of the Register; so that

the total public debt, on October 1st, might have been fairly considered

to have been $1,126,381,095. Of this amount, $541,340,090 consisted of

funded debt, and the balance unfunded debt, or Treasury notes. The

foreign debt is omitted in these statements. It amounted to £2,200,000,

and was provided for by about two hundred and fifty thousand bales of

cotton collected by the Government.[192]

The aggregate appropriations called for by the different departments of

the Government for the six months ending on June 30, 1865, amounted to

$438,416,504. It was estimated that the remains of former appropriations

would, on January 1, 1865, amount to a balance of $467,416,504. No

additional appropriations were therefore required for the ensuing six

months.

A system of measures by which to obtain a revenue from direct taxes and

duties was commenced at the first session of Congress under the

provisional Government. The officers who, at the time of the adoption of

the provisional Constitution, held any office connected with the

collection of the customs, duties, and imposts in the several States of

the Confederacy, or as assistant treasurers intrusted with the keeping

of moneys arising therefrom, were continued in office with the same

powers and subject to the same duties. The tariff laws of the United

States were continued in force until they might be altered. The free

list was enlarged so as to embrace many articles of necessity;

additional ports and places of entry were established; restrictive laws

were repealed, and foreign vessels were admitted to the coasting-trade.

A lighthouse bureau was organized; a lower rate of duties was imposed on

a number of enumerated articles, and an export duty of one eighth of one

cent per pound was imposed on all cotton exported in the raw state. At

the second session, in May, a complete tariff law was enacted, with a

lower scale of duties than had previously existed. On August 19, 1861, a

war-tax of fifty cents on each hundred dollars of certain classes of

property was levied for the special purpose of paying the principal and

interest of the public debt, and of supporting the Government. The

different classes of property on which the tax was levied were as

follows: real estate of all kinds; slaves; merchandise; bank-stocks;

railroad and other corporation stocks; money at interest, or invested by

individuals in the purchase of bills, notes, and other securities for

money, except the bonds of the Confederate States, and cash on hand, or

on deposit; cattle, horses, and mules; gold watches, gold and silver

plate, pianos, and pleasure-carriages. There were some exemptions, such

as the property of educational, charitable, and religious institutions,

and of a head of a family having property worth less than five hundred

dollars. An act was passed for the sequestration of the property of

alien enemies, as a retaliatory measure, to offset the confiscation act

of the United States.

On April 24, 1863, a new act was passed relative to internal or direct

taxes. It was designed to reach, as far as practicable, every resource

of the country except the capital invested in real estate and slaves,

and, by means of an income-tax and a tax in kind on the produce of the

soil, as well as by licenses on business occupations and professions, to

command resources sufficient for the wants of the country. On February

17, 1864, an amendment to this last-mentioned act was passed. It levied

additional taxes on all business of individuals, of copartnerships and

corporations, also on trades, sales, liquor-dealers, hotel-keepers,

distillers, and a tax in kind on agriculturists. On June 10, 1864, an

act was passed which levied a tax equal to one fifth of the amount of

the existing tax upon all subjects of taxation for the year.

Within six months after the passage of the war-tax of August 19, 1861,

the popular aversion to internal taxation by the General Government had

so influenced the legislation of the several States that only in South

Carolina, Mississippi, and Texas were the taxes actually collected from

the people. The quotas of the remaining States had been raised by the

issue of bonds and State Treasury notes. The public debt of the country

was thus actually increased instead of being diminished by the taxation

imposed by Congress.

At the first and second sessions of Congress in 1862 no means were

provided by taxation for maintaining the Government. The legislation was

confined to authorizing further sales of bonds and issues of Treasury

notes. An obstacle had arisen against successful taxation. About two

thirds of the entire taxable property of the Confederate States

consisted in land and slaves. Under the provisional Constitution, which

ceased to be in force on February 22, 1862, the power of Congress to

levy taxes was not restricted by any other condition than that "all

duties, imposts, and excises should be uniform throughout the States of

the Confederacy." But in the permanent Constitution, which took effect

on the same day (February 22d), it was specially provided that

"representatives and direct taxes shall be apportioned among the several

States according to their respective numbers, which shall be determined

by adding to the whole number of free persons--including those bound to

service for a term of years, and excluding Indians not taxed--three

fifths of all slaves." According to the received construction of the

Constitution of the United States, which had been acquiesced in for

sixty years, taxes on lands and slaves were direct taxes. In repeating,

without modification, in our Constitution this language of the United

States Constitution, our Convention necessarily seems to have intended

to attach to it the meaning which had been sanctioned by long and

uninterrupted acquiescence--thus deciding that taxes on lands and slaves

were direct taxes. Our Constitution further ordered that a census should

be made within three years after the first meeting of Congress, and that

"no capitation or other direct tax shall be laid, unless in proportion

to the census or enumeration hereinbefore directed to be taken."

So long as there seemed to be a probability of being able to carry out

these provisions of the Constitution fully, and in conformity with the

intentions of its authors, there was an obvious difficulty in framing

any system of taxation. A law which should exempt from the burden two

thirds of the property of the country would be as unfair to the owners

of the remaining third as it would be inadequate to meet the

requirements of the public service. The urgency of the need, however,

was such that, after great embarrassment, the law of April 24, 1863,

above mentioned, was framed. Still, a very large proportion of these

resources was unavailable for some time, and, the intervening exigencies

permitting of no delay, a resort to further issues of Treasury notes

became unavoidable.

The foreign debt of the Confederate States at the close of the war was

twenty-two hundred thousand pounds. The earliest proposals on which this

debt was contracted were issued in London and Paris in March, 1863. The

bonds bore interest at seven per cent. per annum, in sterling, payable

half-yearly. They were exchangeable for cotton on application, at the

option of the holder, or redeemable at par in sterling, in twenty years,

by half-yearly drawings, commencing March 1, 1864. The special security

of these bonds was the engagement of the Government to deliver cotton to

the holders. Each bond, _at the option of the holder_, was convertible

at its nominal amount into cotton at the rate of sixpence sterling for

each pound of cotton--say four thousand pounds of cotton for each bond

of a hundred pounds, or twenty-five hundred francs; and this could be

done at any time not later than six months after the ratification of a

treaty of peace between the belligerents. Sixty days after the notice,

the cotton was to be delivered, if in a state of peace, at the ports of

Charleston, Savannah, Mobile, or New Orleans; if at war, at points in

the interior of the country, within ten miles of a railroad, or a stream

navigable to the ocean. The delivery was to be made free of all charges,

except the export duty of one eighth of one cent per pound. The quality

of the cotton was to be the standard of New Orleans middling. An annual

sinking fund of five per cent. was provided for, whereby two and a half

per cent. of the bonds unredeemed by cotton should be drawn by lot

half-yearly, so as finally to extinguish the loan in twenty years from

the first drawing. The bonds were issued at ninety per cent., payable in

installments. The loan soon stood in the London market at five per cent.

premium. The amount asked for was three million pounds. The amount of

applications in London and Paris exceeded fifteen million pounds.

Great efforts had previously been made by agents of the United States

Government to reflect upon the credit of the Confederate States, by

resuscitating an almost forgotten accusation of repudiation against the

State of Mississippi, and especially by an emissary sent to Great

Britain, than whom no one knew better how false were the attempts to

implicate my name in that charge. The slanderous tongues of Northern

hatred even went so far as to style me "the father of repudiation." How

unjust all such assertions were, will be manifest by a simple statement

of the case.[193]

We should not omit to refer once more to the most prolific source of

sectional strife and alienation, which is believed to have been the

question of the tariff, or duties upon imports. Its influence extended

to and affected subjects with which it was not visibly connected, and

finally assumed a form surely not contemplated in the original formation

of the Union. In the Articles of Confederation, the first Constitution

of the United States, the theory was that of direct taxation, and the

manner was to impose upon the States an amount which each was to furnish

to the common Treasury to defray expenses for the common defense and

general welfare.

During the period of our colonial existence, the policy of the British

Government had been to suppress the growth of manufacturing industry. It

was forcibly expressed by Lord North in the declaration that "not a

hobnail should be made in the American colonies." The consequence was

that in the War of the Revolution our armies and people suffered so much

from the want of the most necessary supplies that General Washington,

after we had achieved our independence, expressed the opinion that the

Government should by bounties, encourage the manufacture of such

materials as were necessary in time of war.

In the Convention which framed the Constitution for a "more perfect

Union," one of the greatest difficulties in agreeing upon its terms was

found in the different interests of the States, but, among the

compromises which were made, there prominently appears the purpose of a

strict equality in the burdens to be borne, as well as the blessings to

be enjoyed, by the people of the several States. For a long time after

the formation of the "more perfect Union," but little capital was

invested in manufacturing establishments; and, though in the early part

of the present century the amount had considerably increased, the

products were yet quite insufficient for the necessary supplies of our

armies in the War of 1812. Government contracts, high prices, and to

some extent, no doubt, patriotic impulses, led to the investment of

capital in the articles required for the prosecution of the war. With

the restoration of peace and the renewal of commerce, prices naturally

declined, and it was represented that the investments made in

manufacturing establishments were so unprofitable as to involve the ruin

of those who had made them. The Congress of the United States, in 1816,

from motives at least to be commended for their generosity, enacted a

law to protect from the threatened ruin those of their countrymen who

had employed their capital for purposes demanded by the general welfare

and common defense. These good intentions, if it be conceded that the

danger was real which it was designed to avert, were most unfortunate as

the beginning of a policy the end of which was fraught with the greatest

evils that have ever befallen the Union. By the Constitution of 1789

power was conferred upon Congress--

"To lay and collect taxes, duties, imposts, and excises, to pay

the debts and provide for the common defense and general welfare

of the United States; but all duties, imposts, and excises shall

be uniform throughout the United States."

In the exercise of this delegated trust, tariff laws were enacted, and

had been in operation to the satisfaction of all parts of the Union,

from the organization of the Government down to 1816; but throughout

that period all of those laws were based upon the principle of duties

for revenue. It was true, and of course it was known, that such duties

would give incidental protection to any industry producing an article on

which the duty was levied; but, while the money was collected for the

purposes enumerated, and the rate kept down to the lowest revenue

standard, the consumer had no cause to complain of the indirect benefit

received by the manufacturer, and the history of the time shows that it

produced no discontent. Not so with the tariff law of 1816: though

sustained by men from all sections of the Union, and notably by so

strict a constructionist as Mr. Calhoun, there were not wanting those

who saw in it a departure from the limitation of the Constitution, and

sternly opposed it as the usurpation of a power to legislate for the

benefit of a class. The law derived much of its support from the

assurance that it was only a temporary measure, and intended to shield

those whose patriotism had exposed them to danger, thus presenting the

not uncommon occurrence of a good case making a bad precedent. For the

first time a tariff law had protection for its object, and for the first

time it produced discontent. In the law there was nothing which

necessarily gave to it or in its terms violated the obligation that

duties should be uniform throughout the United States. The fact that it

affected the sections differently was due to physical causes--that is,

geographical differences. The streams of the Southern Atlantic States

ran over wide plains into the sea; their last falls were remote from

ocean navigation; and their people, almost exclusively agricultural,

resided principally on this plain, and as near to the seaboard as

circumstances would permit. In the Northern Atlantic States the

highlands approached more nearly to the sea, and the rivers made their

last leap near to harbors of commerce. Water-power being relied on

before the steam-engine had been made, and ships the medium of commerce

before railroads and locomotives were introduced, it followed that the

staples of the Southern plains were economically sent to the water-power

of the North to be manufactured. This remark, of course, applies to such

articles as were not exported to foreign countries, and is intended to

explain how the North became the seat of manufactures, and the South

remained agricultural. From this it followed that legislation for the

benefit of manufacturers became a Northern policy. It was not, as has

been erroneously stated, because of the agricultural character of the

Southern people, that they were opposed to the policy inaugurated by the

tariff act of 1816. This is shown by the fact that anterior to that time

they had been the friends of manufacturing industry, without reference

to its location. As long as duties were imposed for revenue, so that the

object was to supply the common Treasury, it had been cheerfully borne,

and the agriculture of one section and the manufacturing of another were

properly regarded as handmaids, and not unfrequently referred to as the

means of strengthening and perpetuating the bonds by which the States

were united. When duties were imposed, not for revenue, but as a bounty

to a particular industry, it was regarded both as unjust and without

warrant, expressed or implied, in the Constitution.

Then arose the controversy, quadrennially renewed and with increasing

provocation, in 1820, in 1824, and in 1828--each stage intensifying the

discontent, arising more from the injustice than the weight of the

burden borne. It was not the twenty-shilling ship-money tax, but the

violation of Magna Charta, which Hampden and his associates resisted. It

was not the stamp duty nor the tea-tax, but the principle involved in

taxation without representation, against which our colonial fathers took

up arms. So the tariff act in 1828, known at the time as "the bill of

abominations," was resisted by Southern representatives, because it was

the invasion of private rights in violation of the compact by which the

States were united. In the last stage of the proceeding, after the

friends of the bill had advocated it as a measure for protecting capital

invested in manufactures, Mr. Drayton, of South Carolina, moved to amend

the title so that it should read, "An act to increase the duties upon

certain imports, for the purpose of increasing the profits of certain

manufacturers," and stated his purpose for desiring to amend the title

to be that, upon some case which would arise under the execution of the

law, an appeal might be made to the Supreme Court of the United States

to test its constitutionality. Those who had passed the bill refused to

allow the opportunity to test the validity of a tax imposed for the

protection of a particular industry. Though the debates showed clearly

enough the purpose to be to impose duties for protection, the

phraseology of the law presented it as enacted to raise revenue, and

therefore the victims of the discrimination were deprived of an appeal

to the tribunal instituted to hear and decide on the constitutionality

of a law.

South Carolina, oppressed by onerous duties and stung by the injustice

of a refusal to allow her the ordinary remedy against unconstitutional

legislation, asserted the right, as a sovereign State, to nullify the

law. This conflict between the authority of the United States and one of

the States threatened for a time such disastrous consequences as to

excite intense feeling in all who loved the Union as the fraternal

federation of equal States. Before an actual collision of arms occurred,

Congress wisely adopted the compromise act of 1833. By that the fact of

protection remained, but the principle of duties for revenue was

recognized by a sliding scale of reduction, and it was hoped the

question had been placed upon a basis that promised a permanent peace.

The party of protective duties, however, came into power about the close

of the period when the compromise measure had reached the result it

proposed, and the contest was renewed with little faith on the part of

the then dominant party and with more than all of its former bitterness.

The cause of the departure from a sound principle of a tariff for

revenue, which had prevailed during the first quarter of a century, and

the adoption in 1816 of the rule imposing duties for protection, was

stated by Mr. McDuffie to be that politicians and capitalists had seized

upon the subject and used it for their own purposes--the former for

political advancement, the latter for their own pecuniary profit--and

that the question had become one of partisan politics and sectional

enrichment. Contemporaneously with this theory of protective duties,

arose the policy of making appropriations from the common Treasury for

local improvements. As the Southern representatives were mainly those

who denied the constitutional power to make such expenditures, it

naturally resulted that the mass of those appropriations were made for

Northern works. Now that direct taxes had in practice been so wholly

abandoned as to be almost an obsolete idea, and now that the Treasury

was supplied by the collection of duties upon imports, two golden

streams flowed steadily to enrich the Northern and manufacturing region

by the impoverishment of the Southern and agricultural section. In the

train of wealth and demand for labor followed immigration and the more

rapid increase of population in the Northern than in the Southern

States. I do not deny the existence of other causes, such as the fertile

region of the Northwest, the better harbors, the greater amount of

shipping of the Northeastern States, and the prejudice of Europeans

against contact with the negro race; but the causes I have first stated

were, I think, the chief, and those only which are referable to the

action of the General Government. It was not found that the possession

of power mitigated the injustice of its use by the North, and discontent

therefore was steadily accumulating, and, as stated in the beginning of

this chapter, I think was due to class legislation in the form of

protective duties and its consequences more than to any or all other

causes combined. Turning from the consideration of this question in its

sectional aspect, I now invite attention to its general effect upon the

character of our institutions. If the common Treasury of the States had,

as under the Confederation, been supplied by direct taxation, who can

doubt that a rigid economy would have been the rule of the Government;

that representatives would have returned to their tax-paying

constituents to justify appropriations for which they had voted by

showing that they were required for the general welfare, and were

authorized by the Constitution under which they were acting? When the

money was obtained by indirect taxation, so that but few could see the

source from which it was derived, it readily followed that a

constituency would ask, not why the representative had voted for the

expenditure of money, but how much he had got for his own district, and

perhaps he might have to explain why he did not get more. Is it doubtful

that this would lead to extravagance, if not to corruption? Nothing

could be more fatal to the independence of the people and the liberties

of the States than dependence for support upon the public Treasury,

whether it be in the form of subsidies, of bounties, or restrictions on

trade for the benefit of special interests. In the decline of the Roman

Empire, the epoch in which the hopelessness of renovation was made

manifest was that in which the people accepted corn from the public

granaries: it preceded but a little the time when the post of emperor

became a matter of purchase. How far would it differ from this if

constituencies should choose their representatives, not for their

integrity, not for their capacity, not for their past services, but

because of their ability to get money from the public Treasury for the

benefit of their local interests; and how far would it differ from a

purchase of the office if a President were chosen because of the favor

he would show to certain moneyed interests?

Now that fanaticism can no longer inflame the prejudices of the

uninformed, it may be hoped that our statesmen will review the past, and

give to our country a future in accordance with its early history, and

promotive of true liberty.

[Footnote 192: These bales were the security for the foreign cotton

bonds, and were seized by the United States Government. Was it not

liable to the bondholders?]

[Footnote 193: The facts with regard to the Mississippi "Union Bank"

bonds may be briefly stated as follows:

The Constitution of Mississippi required that no law should ever be

passed "to raise a loan of money on the credit of the State, or to

pledge the faith of the State for the payment or redemption of any loan

or debt," unless such law should be proposed and adopted by the

Legislature, then published for three months previous to the next

regular election, and finally reënacted by the succeeding Legislature.

The object was to enable the people of the State to consider the

question intelligently, and to indicate and exercise their will upon it

by the election of representatives to the ensuing Legislature, whose

views upon the subject would be known, and with such instructions,

express or implied, as they might think proper to give.

In 1837 a law was passed by the Legislature for incorporating the "Union

Bank of Mississippi," with a capital of fifteen million five hundred

thousand dollars, "to be raised by means of a loan to be obtained by the

directors of the institution." In order to secure this loan, the

stockholders were required to give mortgages on productive and

unencumbered property, to be in all cases of value greater, by a fixed

ratio, than the amount of their stock. When the stock had been thus

secured, as a further guarantee for the redemption of the loan, the

Governor was directed to issue bonds, in the name and behalf of the

State, equal in amount to the stock secured by mortgage on private

property. No bonds as thus directed were ever issued.

This act was duly promulgated to the people, and duly reënacted by the

succeeding Legislature on the 5th of February, 1838, in strict

accordance with the Constitution.

Ten days afterward, however, viz., on the 15th of February, the

Legislature passed an act _supplemental_ to the act chartering the Union

Bank, which materially changed or abolished the essential conditions for

the pledge of the credit of the State. By this supplemental act the

Governor was instructed, as soon as the books of subscription should be

opened, to "_subscribe for_, in behalf of the State, fifty thousand

_shares of the stock of the original capital of said bank_, to be paid

for out of the proceeds of the State bonds to be executed to the said

bank, as already provided for in the said charter." This act was passed

in the ordinary mode of legislation, and was not referred, published,

nor reënacted, as prescribed by the Constitution. As soon as the

directory was organized and the books of subscription were opened, and

before the mortgages required by the charter were executed, the

Governor, in behalf of the State, subscribed for fifty thousand shares

of the stock, and issued the bonds of the State for five million

dollars, payable to the order of the bank.

These bonds were sold to Nicholas Biddle, President of the United States

Bank of Pennsylvania, and by him sent to Great Britain as collateral

security for a loan previously made. None of the money received for them

went into the Treasury of the State of Mississippi, nor was any of it

used for a public improvement. All the consideration ever received by

the State was its stock in the Union Bank. The bank soon failed, and the

stock became utterly worthless.

Before the bonds became due, the Governor of the State had declared them

to be null and void, among other causes, in consequence of the failure

to sell them at par, as required by the "supplemental act," under which

they were issued.

It is not necessary here to discuss the question of the validity or

nullity of the bonds. The object is merely to state the principal facts.

While these events were occurring, and until a period several years

subsequent to their consummation, I, who had just resigned my commission

in the army, was a private citizen, had never held any civil office, and

took no part in political affairs. Indeed, I have never at any time

before, during, or since those events, held any civil office under the

State government, and neither had nor could have had any part in shaping

the policy of the State. When brought out as a candidate for office, my

nomination was opposed by that section of my party which advocated

"repudiation," on account of my opinions in favor of the payment of the

bonds.

As a private citizen, it may be stated that I held that the question of

the validity of the bonds should be decided by the courts. The

Constitution of Mississippi authorized suit to be brought against the

State in such cases in her own courts, and this I regarded as the proper

course to be pursued by the bondholders, holding that the State would be

bound by the judicial decision, if it should sustain the validity of the

claim. This course, however, was not adopted until long afterward, when

the question had become complicated with political issues, which

rendered the effort to obtain a settlement entirely nugatory.

When I was a member of the Senate of the United States, my official

influence was exerted to promote the objects of a citizen of

Mississippi, who, with quasi-credentials from the United States

Secretary of State, Mr. Buchanan, went to London to propose to the

bondholders an arrangement by which the claim, or the greater portion of

it, might be paid by private subscription, on consideration of the

cancellation of the bonds. This effort failed, from a mistaken estimate

on the part of some of the principal bondholders, to whom the

proposition was made, of the extent to which State pride would induce

our citizens to contribute, and to the belief in a power to coerce

payment. The gentleman who bore the proposal, indignant at the offensive

manner of its rejection, and conscious of the disinterestedness of his

motives, abandoned the negotiation in disgust, and the opportunity was

lost.]

CHAPTER XIV.

Military Laws and Measures.--Agricultural Products

diminished.--Manufactures flourishing.--The Call for

Volunteers.--The Term of Three Years.--Improved Discipline.--The

Law assailed.--Important Constitutional Question raised.--Its

Discussion at Length.--Power of the Government over its own

Armies and the Militia.--Object of Confederations.--The

War-Powers granted.--Two Modes of raising Armies in the

Confederate States.--Is the Law necessary and proper?--Congress

is the Judge under the Grant of Specific Power.--What is meant

by Militia.--Whole Military Strength divided into Two

Classes.--Powers of Congress.--Objections answered.--Good

Effects of the Law.--The Limitations enlarged.--Results of the

Operations of these Laws.--Act for the Employment of

Slaves.--Message to Congress.--"Died of a Theory."--Act to use

Slaves as Soldiers passed.--Not Time to put it in Operation.

The agricultural products were diminished every year during the war. Its

demands diminished the number of cultivators, and their labors were more

extensively devoted to grain-crops. The amount of the cotton-crop was

greatly reduced, and numbers of bales were destroyed when in danger of

falling into the hands of the enemy.

The manufacturing industry became more extensive than ever before, and

in many branches more highly developed. The results in the ordnance

department of the Government, stated elsewhere in these pages, serve as

an illustration of the achievements in many branches of industry.

During the first year of the war the authority granted to the President

to call for volunteers in the army for a short period was sufficient to

secure all the military force which we could fit out and use

advantageously. As it became evident that the contest would be long and

severe, better measures of preparation were enacted. I was authorized to

call out and place in the military service for three years, unless the

war should sooner end, all white men residents of the Confederate States

between the ages of eighteen and thirty-five years, and to continue

those already in the field until three years from the date of their

enlistment. But those under eighteen years and over thirty-five were

required to remain ninety days. The existing organization of companies,

regiments, etc., was preserved, but the former were filled up to the

number of one hundred and twenty-five men. This was the first step

toward placing the army in a permanent and efficient condition. The term

of service being lengthened, the changes by discharges and by receiving

recruits were diminished, so that, while additions were made to the

forces already in the field, the discipline was greatly improved. At the

same time, on March 13, 1862, General Robert E. Lee was "charged with

the conduct of the military operations of the armies of the Confederacy"

under my direction. Nevertheless, the law upon which our success so

greatly depended was assailed with unexpected criticism in various

quarters. A constitutional question of high importance was raised, which

tended to involve the harmony of coöperation, so essential in this

crisis, between the General and the State governments. It was advanced

principally by the Governor of Georgia, Hon. Joseph E. Brown, and the

following extracts are taken from my reply to him, dated

Executive Department, Richmond, _May_ 29, 1862.

"I propose, from my high respect for yourself and for other

eminent citizens who entertain opinions similar to yours, to set

forth somewhat at length my own views on the power of the

Confederate Government over its own armies and the militia, and

will endeavor not to leave without answer any of the positions

maintained in your letters.

"The main, if not the only, purpose for which independent states

form unions, or confederations, is to combine the power of the

several members in such manner as to form one united force in

all relations with foreign powers, whether in peace or in war.

Each state, amply competent to administer and control its own

domestic government, yet too feeble successfully to resist

powerful nations, seeks safety by uniting with other states in

like condition, and by delegating to some common agent the use

of the combined strength of all, in order to secure advantageous

commercial relations in peace, and to carry on hostilities with

effect in war.

"Now, the powers delegated by the several States to the

Confederate Government, which is their common agent, are

enumerated in the eighth section of the Constitution; each power

being distinct, specific, and enumerated in paragraphs

separately numbered. The only exception is the eighteenth

paragraph, which by its own terms is made dependent on those

previously enumerated, as follows: '18. To make all laws which

shall be necessary and proper for carrying into execution the

foregoing powers,' etc.

"Now the _war-powers_ granted to the Congress are conferred in

the following paragraphs: No. 1 'gives authority to raise

revenue necessary to pay the debts, provide for _the common

defense_, and carry on the Government,' etc. No. 11, 'To declare

war, grant letters of marque and reprisal, and make rules

concerning captures on land and water.' No. 12, 'To raise and

support armies, but no appropriations of money to that use shall

be for a longer term than two years.' No. 13, 'To provide and

maintain a navy.' No. 14, 'To make rules for the government and

regulation of _the land and naval forces_.'

"It is impossible to imagine a more broad, ample, and

unqualified delegation of the whole war power of each State than

is here contained, with the solitary limitation of the

appropriations to two years. The States not only gave power to

raise money for the common defense, to declare war, to raise and

support armies (in the plural), to provide and maintain a navy,

to govern and regulate both land and naval forces, but they went

further, and covenanted, by the third paragraph of the tenth

section, not 'to engage in war, unless actually invaded, or in

such imminent danger as will not admit of delay.'

"I know of but two modes of raising armies within the

Confederate States, viz., voluntary enlistment and draft, or

conscription. I perceive, in the delegation of power to raise

armies, no restriction as to the mode of procuring troops. I see

nothing which confines Congress to one class of men, nor any

greater power to receive volunteers than conscripts into its

service. I see no limitation by which enlistments are to be

received of individuals only, but not of companies, or

battalions, or squadrons, or regiments. I find no limitation of

time of service, but only of duration of appropriation. I

discover nothing to confine Congress to waging war within the

limits of the Confederacy, nor to prohibit offensive war. In a

word, when Congress desires to raise an army, and passes a law

for that purpose, the solitary question is under the eighteenth

paragraph, viz., 'Is the law one that is necessary and proper to

execute the power to raise armies?'

"On this point you say: `But did the necessity exist in this

case? The conscription act can not aid the Government in

increasing its supply of _arms_ or _provisions_, but can only

enable it to call a larger number of men into the field. The

difficulty has never been to get _men_. The States have already

furnished the Government more than it can arm,' etc.

"I would have very little difficulty in establishing to your

entire satisfaction that the passage of the law was not only

necessary, but that it was absolutely indispensable; that

numerous regiments of twelve months' men were on the eve of

being disbanded, whose places could not be supplied by raw

levies in the face of superior numbers of the foe, without

entailing the most disastrous results; that the position of our

armies was so critical as to fill the bosom of every patriot

with the liveliest apprehension; and that the provisions of this

law were effective in warding off a pressing danger. But I

prefer to answer your objection on other and broader grounds.

"I hold that, when a specific power is granted by the

Constitution, like that now in question, 'to raise armies,'

Congress is the judge whether the law passed for the purpose of

executing that power is 'necessary and proper.' It is not enough

to say that armies might be raised in other ways, and that,

therefore, this particular way is not 'necessary.' The same

argument might be used against _every_ mode of raising armies.

To each successive mode suggested, the objection would be that

other modes were practicable, and that, therefore, the

particular mode used was not 'necessary.' The true and only test

is to inquire whether the law is intended and calculated to

carry out the object; whether it devises and creates an

instrumentality for executing the specific power granted; and,

if the answer be in the affirmative, the law is constitutional.

None can doubt that the conscription law is calculated and

intended to 'raise armies'; it is, therefore, 'necessary and

proper' for the execution of that power, and is constitutional,

unless it comes in conflict with some other provision of our

Confederate compact.

"You express the opinion that this conflict exists, and support

your argument by the citation of those clauses which refer to

the militia. There are certain provisions not cited by you,

which are not without influence on my judgment, and to which I

call your attention. They will aid in defining what is meant by

'militia,' and in determining the respective powers of the

States and the Confederacy over them.

"The several States agree 'not to keep troops or ships of war in

time of peace.'[194] They further stipulate that, 'a

well-regulated militia being necessary for the security of a

free State, the right of the people to keep and bear arms shall

not be infringed.'[195]

"'That no person shall be held to answer for a capital or

otherwise infamous crime, unless on a presentment or indictment

of a grand jury, except in cases arising in the _land_ or _naval

forces_, or in _the militia_ when in actual service in times of

war or public danger.'[196]

"What, then, are militia? They can only be created by law. The

arms-bearing inhabitants of a State are liable to become its

militia, if the law so order; but, in the absence of a law to

that effect, the men of a State capable of bearing arms are no

more militia than they are seamen.

"The Constitution also tells us that militia are not _troops_,

nor are they any part of the _land_ or _naval forces_; for

militia exist in time of peace, and the Constitution forbids the

States to keep troops in time of peace, and they are expressly

distinguished and placed in a separate category from land or

naval forces in the sixteenth paragraph above quoted; and the

words _land_ and _naval forces_ are shown by paragraphs 12, 13,

and 14, to mean the Army and Navy of the Confederate States.

"Now, if militia are not the citizens taken singly, but a body

created by law; if they are not troops; if they are no part of

the Army and Navy of the Confederacy, we are led directly to the

definition, quoted by the Attorney-General, that militia are 'a

body of soldiers in a State enrolled for discipline.' In other

words, the term 'militia' is a collective term meaning a body of

men organized, and can not be applied to the separate

individuals who compose the organization.

"The Constitution divides the whole military strength of the

States into only two classes of organized bodies: one, the

armies of the Confederacy; the other, the militia of the States.

"In the delegation of power to the Confederacy, after exhausting

the subject of declaring war, raising and supporting armies, and

providing a navy, in relation to all which the grant of

authority to Congress is _exclusive_, the Constitution proceeds

to deal with the other organized body, the militia; and, instead

of delegating power to Congress alone, or reserving it to the

States alone, the power is divided as follows, viz.: Congress is

to have power 'to provide for calling forth the militia to

execute the laws of the _Confederate_ States, suppress

insurrections, and _repel invasions_.'[197]

"'To provide for organizing, arming, and disciplining the

militia, and for governing such part of them as may be employed

in the service of the Confederate States; _reserving_ to _the

States respectively the appointment of the officers_, and the

_authority of training the militia_, according to the discipline

prescribed by Congress.'[198]

"Congress, then, has the power to provide for _organizing_ the

arms-bearing people of the State into militia. Each _State_ has

the power to officer and _train_ them when organized.

"_Congress_ may call forth the militia to execute Confederate

laws; the _State_ has not surrendered the power to call them

forth to execute State laws.

"Congress may call them forth to repel invasion; so may the

State, for the power is impliedly reserved of governing all the

militia, except the part in actual service of the Confederacy.

"I confess myself at a loss to perceive in what manner these

careful and well-defined provisions of the Constitution,

regulating the organization and government of the militia, can

be understood as applying in the remotest degree to the armies

of the Confederacy, nor can I conceive how the grant of

_exclusive_ power to declare and carry on war by armies raised

and supported by the Confederacy is to be restricted or

diminished by the clauses which grant a _divided_ power over the

militia. On the contrary, the delegation of authority over the

militia, so far as granted, appears to me to be plainly an

_additional_ enumerated power intended to strengthen the hands

of the Confederate Government in the discharge of its paramount

duty, the common defense of the States.

"You state, after quoting the twelfth, fifteenth, and sixteenth

grants of power to Congress, that 'these grants of power all

relate to the same subject-matter, and are all contained in the

same section of the Constitution, and, by a well-known rule of

construction, must be taken as a whole and construed together.'

"This argument appears to me unsound. _All_ the powers of

Congress are enumerated in one section, and the three paragraphs

quoted can no more control each other by reason of their

location in the same section than they can control any of the

other paragraphs preceding, intervening, or succeeding. So far

as the subject-matter is concerned, I have already endeavored to

show that the armies mentioned in the twelfth paragraph are a

subject-matter as distinct from the militia mentioned in the

fifteenth and sixteenth as they are from the navy mentioned in

the thirteenth. Nothing can so mislead as to construe together,

and as a whole, the carefully separated clauses which define the

different powers to be exercised over distinct subjects by the

Congress.

"But you add that, 'by the grant of power to Congress to raise

and support armies without qualification, the framers of the

Constitution intended the regular armies of the Confederacy, and

not armies composed of the whole militia of all the States.'

"I must confess myself somewhat at a loss to understand this

position. If I am right that the militia is a body of enrolled

State soldiers, it is not possible in the nature of things that

armies raised by the Confederacy can 'be composed of the whole

militia of all the States.' The militia may be called forth in

whole or in part into the Confederate service, but do not

thereby become part of the 'armies raised' by Congress. They

remain militia, and go home when the emergency which provoked

their call has ceased. Armies raised by Congress are of course

raised out of the _same population_ as the militia organized by

the States, and to deny to Congress the power to draft a citizen

into the army, or to receive his voluntary offer of services,

because he is a member of the State militia, is to deny the

power to raise an army at all; for, practically, all men fit for

service in the army may be embraced in the militia organization

of the several States. You seem, however, to suggest, rather

than directly to assert, that the conscript law may be

unconstitutional, because it comprehends all arms-bearing men

between eighteen and thirty-five years; at least, this is an

inference which I draw from your expression, 'armies composed of

the _whole_ militia of _all_ the States.' But it is obvious

that, if Congress have power to draft into the armies raised by

it any citizens at all (without regard to the fact whether they

are, or not, members of militia organizations), the power must

be coextensive with the exigencies of the occasion, or it

becomes illusory; and the extent of the exigency must be

determined by Congress; for the Constitution has left the power

without any other check or restriction than the Executive veto.

Under ordinary circumstances, the power thus delegated to

Congress is scarcely felt by the States. At the present moment,

when our very existence is threatened by armies vastly superior

in numbers to ours, the necessity for defense has induced a

call, not for 'the whole militia of all the States,' not for any

militia, but for men to compose _armies_ for the Confederate

States.

"Surely there is no mystery in this subject. During our whole

past history, as well as during our recent one year's experience

as a new Confederacy, the militia 'have been called forth to

repel invasion' in numerous instances, and they never came

otherwise than as bodies organized by the States with their

company, field, and _general officers_; and, when the emergency

had passed, they went home again. I can not perceive how any one

can interpret the conscription law as taking away from the

States the power to appoint officers to their militia. You

observe on this point in your letter that, unless your

construction is adopted, 'the very object of the States in

reserving the power of appointing the officers is defeated, and

that portion of the Constitution is not only a nullity, but the

whole military power of the States, and the entire control of

the militia, with the appointment of the officers, is vested in

the Confederate Government, whenever it chooses to call its own

action "raising an army," and not "calling forth the militia."'

"I can only say, in reply to this, that the power of Congress

depends on the real nature of the act it proposes to perform,

not on the name given to it; and I have endeavored to show that

its action is really that of 'raising an army,' and bears no

semblance to 'calling forth the militia.' I think I may safely

venture the assertion that there is not one man out of a

thousand of those who will do service under the conscription act

that will describe himself while in the Confederate service as

being a militiaman; and, if I am right in this assumption, the

popular understanding concurs entirely with my own deductions

from the Constitution as to the meaning of the word 'militia.'

"My answer has grown to such a length, that I must confine

myself to one more quotation from your letter. You proceed:

'Congress shall have power to _raise armies_. How shall it be

done? The answer is clear. In conformity to the provisions of

the Constitution, which expressly provides that, when the

militia of the States are called forth to _repel invasion_, and

employed in the service of the Confederate States, which is now

the case, the State shall appoint the officers.

"I beg you to observe that the answer which you say is clear is

not an answer to the question put. The question is, How are

armies to be raised? The answer given is, that, when militia are

called upon to repel invasion, the State shall appoint the

officers.

"There seems to me to be a conclusive test on this whole

subject. By our Constitution, Congress may declare war,

_offensive_ as well as _defensive_. It may acquire territory.

Now, suppose that, for good cause and to right unprovoked

injuries, Congress should declare war against Mexico and invade

Sonora. The militia could not be called forth in such a case,

the right to call it being limited 'to repel invasions.' Is it

not plain that the law now under discussion, if passed under

such circumstances, could by no possibility be aught else than a

law to 'raise an army'? Can one and the same law be construed

into a 'calling forth the militia,' if the war be defensive, and

a 'raising of armies,' if the war be offensive?

"At some future day, after our independence shall have been

established, it is no improbable supposition that our present

enemy may be tempted to abuse his naval power by depredations on

our commerce, and that we may be compelled to assert our rights

by offensive war. How is it to be carried on? Of what is the

army to be composed? If this Government can not call on its

arms-bearing population otherwise than as militia, and if the

militia can only be called forth to repel invasion, we should be

utterly helpless to vindicate our honor or protect our rights.

War has been well styled 'the terrible litigation of nations.'

Have we so formed our Government that in this litigation we must

never be plaintiffs? Surely this can not have been the intention

of the framers of our compact.

"In no respect in which I can view this law can I find just

reason to distrust the propriety of my action in approving and

signing it; and the question presented involves consequences,

both immediate and remote, too momentous to permit me to leave

your objections unanswered.

"Jefferson Davis."

The operation of this law was suspended in the States of Kentucky,

Missouri, and Maryland, because of their occupation by the armies of the

Federal Government. The opposition to it, where its execution was

continued, soon became limited, and before June 1st its good effects

were seen in the increased strength and efficiency of our armies. At the

same time I was authorized to commission officers to form bands of

"Partisan Rangers," either of infantry or cavalry, which were

subsequently confined to cavalry alone. On September 27, 1862, all white

men between the ages of thirty-five and forty-five were placed in the

military service for three years. All persons subject to enrollment

might be enrolled wherever found, and were made subject to the

provisions of the law. Authority was also given for the reception of

volunteers from the States in which the law was suspended. On February

11, 1864, it was enacted by Congress that all white men between the ages

of seventeen and fifty should be in the military service for the war;

also, that all then in the service between the ages of eighteen and

forty-five should be retained during the war. An enrollment was also

ordered of all persons between the ages of seventeen and eighteen and

between forty-five and fifty years, who should constitute a reserve for

State defense and detail duty. On February 17th all male free negroes

between the ages of eighteen and fifty years were made liable to perform

duties with the army, or in connection with the military defenses of the

country in the way of work upon the fortifications, or in Government

works for the production or preparation of materials of war, or in

military hospitals. The Secretary of War was also authorized to employ

for the same duties any number of negro slaves not exceeding twenty

thousand.

In the operation of the military laws we found the exemption from

military duty accorded by the law to all persons engaged in certain

specified pursuits or professions to be unwise. Indeed, it seems to be

indefensible in theory. The defense of home, family, and country is

universally recognized as the paramount political duty of every member

of society; and, in a form of government where each citizen enjoys an

equality of rights and privileges, nothing can be more invidious than an

unequal distribution of duties or obligations. No pursuit nor position

should relieve any one who is able to do active duty from enrollment in

the army, unless his functions or services are more useful to the

defense of his country in another sphere. But the exemption from service

of entire classes should be wholly abandoned.

The act of February 17, 1864 (above mentioned), which authorized the

employment of slaves, produced less results than had been anticipated.

It, however, brought forward the question of the employment of the

negroes as soldiers in the army, which was warmly advocated by some and

as ardently opposed by others. My own views upon it were expressed

freely and frequently in intercourse with members of Congress, and

emphatically in my message of November 7, 1864, when, urging upon

Congress the consideration of the propriety of a radical modification of

the theory of the law, I said:

"Viewed merely as property, and therefore as the subject of

impressment, the service or labor of the slave has been

frequently claimed for short periods in the construction of

defensive works. The slave, however, bears another relation to

the state--that of a person. The law of last February

contemplates only the relation of the slave to the master, and

limits the impressment to a certain term of service.

"But, for the purposes enumerated in the act, instruction in the

manner of camping, marching, and packing trains is needful, so

that even in this limited employment length of service adds

greatly to the value of the negro's labor. Hazard is also

encountered in all the positions to which negroes can be

assigned for service with the army, and the duties required of

them demand loyalty and zeal.