Cause and Effects of North and South America’s Economic System on the Civil War

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18/05/20 History Reference this

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How did the economic system in the North and South of America cause and affected the American Civil War

What was the economic system like in the north and in the south?

To what extent was the economy the cause of the war?

The American Civil War arose mostly from the issues of racial discrimination and slavery, but these significant problems are interconnected to the economic differences between the North and South. To understand and answer this question, this essay is conducted and explains the following: what was the economic system like in the North and the South and to what extent was the economy the cause of the war.

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The American Civil War was mostly caused by the controversial opinion of the South and the North of America on slavery, which is directly linked to their economic system. Before the Civil War, the South was very wealthy and was a “big money maker”[1]for the United States in terms of exports. The main export source was raw cotton and by 1840 it was worth all of the other exported goods combined, [2]and this is due to the Industrial Revolution in Britain where innovations in the textile industries enabled fabric to be made quicker, cheaper and using less worker per machine. Unfortunately, resulted from this boost of demand for raw cotton, from 1790, the number of slaves in America was 700000, but by 1860 it increased to 4000000. (footnote) The South maintained a large economic system based on farming and farming required large and cheap workforce which is slave labour. In 1860, 84 per cent of the farmers in South America was engaged in Agriculture, comparing to the South of only 40 per cent (footnote). Additionally, the South lacked in other areas, especially in innovations, energy resources and technologies. South had minimal manufacturing capability, about 29 per cent of the railroad tracks, and only 13 per cent of the nation’s banks. (footnote). The exploitation of slavery as agricultural man force is demonstrated through “Slaves returning from the cotton fields in South Carolina”, a primary source of a photograph taken around 1860. This photograph depicted an endless line of African Americans, men, women and children. They were carrying heavy burdens of cotton on their heads and walked towards the same direction. This photograph presented the economic system in the South American and how slavery is the irreplaceable building block its giant agricultural system.

In contrast to the South of America, North America had a largely industrial economy which allowed it to produce goods cheaply and easily, thus the North entered the post-war years in better economic shape. (footnote) People in the North lived in larger cities such as Boston and New York which is more urbanised comparing to the South. This impacted their economic system to lean towards a commercial and manufacturing economy, which directly influenced its war-making ability. By 1860, 90 per cent of the nation’s manufacturing output came from northern states. The North produced 17 times more cotton and woollen textiles than the South, 20 times more pig iron, and 32 times more firearms. The Union was a booming manufacturing industry not only due to its mass factory production but also because of the large number of railroads and machinery that allowed them to easily surpass the output of the south. The economic motive of the war is supported by an image presented from the book “clash of extremes” by Marc Egnal. This image depicted the new inventions and innovations pioneered during the Industrial revolution and brought to North America such as factory conditions and steam engines. This is evidence of North America’s economy as it explains the advantages from industrialisation which is superior to the South.

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As both the North and the South assembled for war, the relative strength and weaknesses of the “agricultural” and the “slave labour” economic system became increasingly clear, particularly in their ability to support, sustain a war economy, this is a competition of longevity. The Union’s industrial economy roamed during the war due to the North continued its rapid urbanisation and industrialisation to suppress the rebellion. (footnote) In the South, smaller industrial base, fewer rail lines and new transportations and an entire economic system heavily depended on slave labour increased difficulty in the mobilization of resources. As the war continues, the Union’s advantage in factories, transport and manpower put the Confederacy at a great advantage, and directly lead to its defeat. 

In conclusion, to answer the question raised in the beginning, the American Civil War began mostly because of the differential economic system in the South and the North. The economic system caused and affected the Civil War in any way, but mainly due to South’s dependency on slavery resulted from its agricultural economy. Their differential ecosystem not only caused the Civil War but also resulted in the vanquishment of Southern America against the North as the American Civil War came to an end. 

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[1] “Industry and Economy during the Civil War (U.S. National Park Service).” National Parks Service. U.S. Department of the Interior, n.d. https://www.nps.gov/articles/industry-and-economy-during-the-civil-war.htm.

[2] “Story (U.S. National Park Service).” National Parks Service. U.S. Department of the Interior. Accessed September 5, 2019. https://www.nps.gov/resources/story.htm?id=251.

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