A Lesson in Taxation, Part Nine: Tax Law, Slavery, and the Civil War
December 16, 2009 by Taxcut Editor
Filed under Personal and Business Taxes
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
Could there be a doubt about it? Of course the American Civil War was about the slavery issue… was it not? Well actually, one of the most hoaxes in our history is that the Civil War was started over the slavery issue and that Lincoln, the Great Emancipator, used a terrible struggle to break the chains of bonding that enslaved over 3 million black Americans. Right before the war, the South had everything its way.
In 1860, the South controlled the Supreme Court and Lincoln and Congress were beginning the process of passing a constitutional amendment to protect slavery for all time! What happened?
We should move the time back to the year 1832. By that year the national debt from the War of 1812 had been re-paid and the South didn’t see a need to keep up the exorbitant import taxes which appeared to only raise 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!
So, in 1832 a convention was hosted in South Carolina to get rid of these federal import taxes. The convention decided the tax was unconstitutional and authorized the governor to defy the enforcement of the import taxes instituted by the national government. It looked like a civil war was in the works. Cool heads prevailed, however, and the Great Compromise of 1833 lowered import taxes over the next few years to levels the South would tolerate. Go here if you want help with a modern-day Tax Return in Raleigh, NC.
Over the next few years, however, Northern commercial and manufacturer companies forced into Congress new taxes that once again oppressed Southern planters and made Northern manufacturers become rich. In 1850, John C. Calhoun, the South’s most exceptional spokesperson, gave a speech to Congress. It spoke of three grievances of the South that may 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 solid complaint, was about tax policy. In Calhoun’s eyes, national import taxes was a class legislation against the South. Heavy taxes on the South created funds that were spent in the North. The focus of economic strength in the country was shifting heavily to the North. Calhoun threatened secession if the taxes weren’t lowered. But what about the slaves? Well, in his run for the presidency in 1860, Lincoln repeatedly said he would not do anything about slavery in the South. Actually, most Northerners did not care much about black men in bondage, just as little as how much they worried about the Native-American in the West or impoverished uneducated workers in factories. The majority of black slaves got better treatment and more compassion than their counterparts in the North. Lincoln, in fact, assured Southern slave-owners that fugitive slaves would be returned. The Congress and then the Supreme Court (Dred Scott decision) further acknowledged that slavery was here to stay.
However, just as Lincoln was placed in office and Congress assembled in 1861, they created new high import tariffs. Slavery wasn’t the issue – higher import taxes were. In his inaugural address Lincoln said he would collect the customs in the South even if there happened to be a secession!
Fort Sumter, near the beginning of the Charleston Harbor, began filling with Union soldiers to enforce the collection of the new taxes. The Civil War began in 1861 when South Carolinians fired on the federal garrison at Fort Sumter. The inevitable had been brewing for years – but it was not over slavery. It was about taxes.
2 years after that, 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 – the majority of the North cared little concerning black people in bondage, no more than they thought about Native-Americans in the west or impoverished uneducated peasants in the factories. By and large, many black slaves got better treatment and greater compassion than their impoverished counterparts in the North.
That’s it for the History of Taxes Series!
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