A Lesson in Tax Law, Section Nine: Taxation, the Slaves, and the Civil War
W. Marc Gilfillan, CPA, NC, individual and business CPA and Tax expert, shares about the history of taxes…
“Slavery – the one cause of the Civil War.” – John Stuart Mill, 1862
Can there be any doubt concerning it? Of course the American Civil War was about slavery… was it not? Well actually, one of the greatest hoaxes in American history is that the Civil War began because of the slavery issue and that Lincoln, the Great Emancipator, fueled a terrible war to break the chains of bondage that enslaved over 3 million black Americans. Just prior to the war, the South had everything it could have wanted.
In 1860, the South held the Supreme Court and Lincoln and Congress were beginning the process of passing a constitutional amendment to keep slavery for all time! So what happened?
We should rewind the clock back to the year 1832. By that year the national debt from the War of 1812 had been paid and Southerners didn’t see a need to keep up the high import taxes that seemed to only jack up price tags for Southern consumers. Either the South had to pay high import taxes on imported goods or it purchased Northern manufactured goods at excessive prices. In either case, the South’s money transferred to the North. To say the least, the South was not happy with this arrangement. If you’re feeling the pressure with today’s taxes, call a CPA for Tax Preparation in Raleigh, NC for all your tax-related needs!
Consequently, in 1832 a convention was hosted in South Carolina to get rid of these federal import taxes. The South decided the tax was unconstitutional and gave the governor the power to to resist the enforcing of these taxes instituted by the national government. It looked like a civil war was in the works. Mild tempers prevailed, however, and the Great Compromise of 1833 reduced import taxes over the subsequent several years to levels the South could tolerate. Go here if you want help with a modern-day Tax Return in Raleigh, NC.
Over the next few years, however, Northern corporate and manufacturer interests forced through Congress more taxes that once again stressed Southern planters and allowed Northern Manufacturers to become rich once again. In 1850, John C. Calhoun, the South’s most outstanding spokesman, delivered a speech to Congress. It listed three wrongs done to the South that could lead to secession from the Union and war. The first two involved fears about the erosion of power of the South in general and the the power of state government as well.
The third, and only concrete grievance, concerned tax policy. In Calhoun’s view, national import taxes was a targeted legislation against the South. Heavy taxation on the South raised money that was used in the North. The center of economic strength in the United States was steadily changing heavily to the North. Calhoun spoke of secession if the taxes weren’t lowered. But what of the slavery issue? Well, in his campaign for the presidency in 1860, Lincoln repeatedly said he wouldn’t interfere with slavery in the South. Actually, the vast majority of Northerners did not care much about enslaved blacks, just as little as how much they cared about the Native-American in the West or poor uneducated workers in factories. By and large many black slaves got substantially better quality treatment and better compassion than their working-class counterparts in the North. Lincoln, actually, told Southern plantation-owners that fugitive slaves would be caught. The Congress and subsequently the Supreme Court (Dred Scott decision) further acknowledged that slavery wasn’t going anywhere.
However, right as Lincoln was placed in office and Congress assembled in 1861, they created more high import tariffs. Slavery was not an issue – higher import taxes were. In his inaugural address Lincoln stated he would collect the customs in the South even if there happened to be a secession!
Fort Sumter, near the entrance of the Charleston Harbor, began filling with Union soldiers to enforce the collection of the new taxes. The Civil War started in 1861 when South Carolinians shot at the federal garrison at Fort Sumter. The conflict had been stewing for years – but it wasn’t about the slaves. It was about taxes.
Two years later, Lincoln issued the Emancipation Proclamation, and then only following several military battles, as a last resort to rally the North to a worthwhile cause. With respect to the slave issue – most the North didn’t care much concerning black people in bondage, any more than they thought of Indians in the west or impoverished illiterate workers in the factories. By and large, most black slaves received better treatment and more compassion than their impoverished counterparts in the North.
That’s it for the History of Taxes Series!
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