economics of civil war - north v. south
TRANSCRIPT
-
8/19/2019 Economics of Civil War - North v. South
1/2
C o p y r i gh
t © T h
e M
c G r a
w- H i l l
C om
p a ni e
s ,I n
c .P
e r mi s
s i oni s
gr a n
t e d t or e
pr o
d u c e f or
c l a s s r o
om u
s e .
netw rks
NAME _______________________________________ DATE _______________ CLASS _________
The Civil War, 1861–1865
Economics of History Activity
North v. South
When the Civil War began, the human, economic,and geographic advantages of the United Stateswere divided among the Union and theConfederacy based on their location. Both theNorth and the South had distinct advantages anddisadvantages resulting from this division. Bothsides overrated their advantages and expected towin the conflict quickly. Instead, the Civil Warbecame a long, bloody, and bitter struggle in whichneither side won easily. As the war dragged on,the advantages of the North became more andmore important and eventually assured victory
for the Union.
The different cultures and economies of the Northand South led to different strengths andweaknesses on both sides. The South not only hadan agrarian, cash-crop–based economy, it had astrong military tradition. This tradition provided theConfederacy with an experienced, skilled officercorps to lead its troops in battle. The North,however, with its industrial economy, had manymore advantages, as the graph above shows. Ineverything from population to production to financing, the North was ahead of the South, insome ways far ahead.
Both sides faced the problem of financing the war effort. The North enjoyed severaladvantages on the financial front. It controlled the national treasury and could expectcontinued revenue from tariffs. Many Northern banks also held large cash reserves, whichthey lent the government by purchasing bonds. Concern about the North’s ability to win the
Economics Terms to Know
tariffs taxes imposed on a productwhen it is imported into a country
cash reserves money a bank,company, or individual keeps onhand to meet short-term andemergency funding needs
bonds notes issued by thegovernment that promise to pay offa loan with interest
greenbacks pieces of U.S. papermoney first issued by the Northduring the Civil War
paper money currency in theform of government notes andbank notes
inflation the loss of value of money
-
8/19/2019 Economics of Civil War - North v. South
2/2
C o p y r i gh
t © T h
e M
c G r a
w- H i l l
C om
p a ni e
s ,I n
c .P
e r mi s
s i oni s
gr a n
t e d t or e
pr o
d u c e f or
c
l a s s r o
om u
s e .
netw rks
NAME _______________________________________ DATE _______________ CLASS _________
The Civil War, 1861–1865
war caused many people to withdraw gold and silver from the banks. Without gold andsilver, the banks could not buy government bonds, but Congress responded by creating anational currency and authorizing the printing of greenbacks. The Confederacy was alsoforced to print paper money, but in the South this led to rapid inflation. By the end of thewar, the South had experienced 9,000 percent inflation, compared to only 80 percent inthe North.
Applying Economics to History1. What economic advantages did the North enjoy as a result of its greater population?
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
2. Which of the North’s advantages do you think were most important in winning the war?
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
3. Why do you think inflation was so much worse in the South than it was in the Northduring the Civil War?
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
Economics of History Activity Cont.