Trading with the Enemy
The Covert Economy During the American Civil War
Westholme Publishing 2014
6 x 9 hardback
20 b/w illus., map
My post on “Bagdad, Back Door to the Confederacy” garnered a comment from author Philip Leigh about other trading arrangements, especially those between the United States and the Confederacy, which in turn led to a look at his book. Most of us know that at least some trading went on between the two enemies – the best known examples being soldiers swapping items like tobacco and newspapers during truces – but in fact the scale of the “interbelligerent” trade was staggering, amounting the millions of dollars, much of which went directly to arm and sustain the Confederacy. On the Northern side the profits from this extremely lucrative trade lined the pockets of politicians, generals, and various enterprising entrepreneurs, building fortunes that endure to this day.
For the perennially strapped Confederacy trading its most precious commodity was a matter of necessity as it was the only way to obtain the materiel necessary to carry on the war. For the Union, matters were considerably more complex. There was money to be made, of course, but there were other pressing concerns as well. One was that the white gold – cotton – was a necessity for the economies of both the United States and Europe, and that the American South was at the time virtually the only supplier. Without it the mills of New England, England, and France would be idled, with potentially ugly results from the unemployed workers, not to mention the lost revenue and adverse effects on the balance of trade. It therefore became a unofficial Federal policy to allow a certain amount of cotton to be traded in order to avoid this, regardless of the effect on the conduct of the war. Although we think today that most Southern cotton went to Europe via blockade runners, Leigh makes a convincing case that the bulk of it went to the mills of New England. In fact one prominent mill owner, Amos Lawrence, opined that “business was better than ever” during the war. And why not – he was being provided with not only the raw materials but a ready market for his finished goods.
Corruption went all the way to the top, with prominent politicians, lawyers, generals and cabinet members all sharing in the bountiful spoils. Although there is no evidence that Lincoln profited personally from the trade, it did make for a cheap and convenient political payoff – a signed authorization to trade cotton from the president could be worth millions, and it helped insure the loyalty of wavering politicians and entire states. Lincoln also wanted to flood the South with Greenbacks, which he thought would dispose the people there to return to the Union.
Cotton came overland from the plantations under Union control (where the “ex” slaves were anything but) and from direct trade with Confederate sellers, both legal and otherwise. Confederate cotton was also shipped from the neutral port of Bagdad directly to US ports like New York, as well as from Union-controlled ports like New Orleans and Norfolk. A copious amount also went directly from blockaded Southern ports as well, through means legal and illegal. The simplest way was to bribe the blockaders, but shipper could also use a “broken voyage” by way of another neutral port like Halifax, Bermuda, or Havana, or the whole affair might take place only on paper, with hefty bribes assuaging the curiosity of Federal agents as to the cotton’s origin. Badly needed materiel, including arms, returned to Dixie the same way.
None of this was exactly a secret. Grant protested against it, pointing out that not only did it help the Confederacy, it demoralized the Union troops struggling by on $13 a month to see this sort of blatant war profiteering in their midst. Even as late as 1865, after fall of Wilmington, Lee’s army was being supplied mainly through Union-held Norfolk via the Chesapeake. Grant was not blameless either – he had issued one of the first legal cotton-trading permits to his own father-in-law. In short, there was just too much money being made to stop the trade.
Late in the war Congress tried to reign in the illegal trade with an investigation that condemned the “disgraceful scramble for wealth” (never mind that many of them were scrambling for it as well), but Lincoln evaded their restrictions and opened the trade wider than ever.
In all, the book is a tribute to greed in all its forms. While the intersectional trade did have the positive effect of softening the economic impact of the war in both the North and South, it also made illicit fortunes and by some estimates lengthened the war (and the resulting casualty lists) by at least a year.
The book itself is short, well written & edited. Philip Leigh is a regular contributor to the New York Times’ Disunion series and has previously edited a new version of Sam Watkins’ memoir Company Aytch.
I enjoyed the book but found myself wishing it was a bit longer, and like The London Confederates thought that more could have been done with the rich cast of rogues, scalawags, reprobates, crooks and hustlers (as well as the occasional honest patriot) that infest the chronicle.
All in all an eye-opening, behind the scenes look at a fascinating, little known and not so pretty chapter of the Late Unpleasantness.
Full disclosure – I did receive a review copy.