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387 16 The Post–Civil War Economy in the South Thomas D. Clark The Confederate soldier straggling home after Lee’s surrender at Appomattox came home to ruin. Many Southern towns and all of the railroads were laid waste by the invading Union Army. Four years of conflict had taken a terrific toll of property and human life. More important even than this was the fact that Southern energy was depleted not only during the war but for many years to come in the future. No historian can ever estimate the price of total destruction in many parts of the South because much of this was in the form of loss of highly potential human leadership . Many a bright young Southerner went to a soldier’s grave who in the years ahead might have given the South the necessary impetus to bring about changes. Even though Southern economy was greatly disrupted and displaced it was not pushed out of the grooves of its old procedures. Unhappily the idea that cotton was king was so deeply impressed upon the Southern mind before 1860 that it became within itself a cause to be defended. Cotton was a prime commodity during the war in both domestic and foreign trade. Smugglers had slipped thousands of bales out of the region, farmers had hidden their crops from the invaders, and the United States Government held other hundreds of thousands of bales in warehouses. No one knew at the war’s end how many bales of raw cotton were available. One thing, however, was clear—cotton was bringing a good price, and it seemed that Southern farmers could begin all over again devoting their attention to the production of this staple crop. Reprinted, with minor abridgement, with permission from American Jewish Historical Quarterly 55 (June 1966): 424–432, copyright © by the American Jewish Historical Society. 388 Thomas D. Clark There was little actual choice for hosts of Southerners after 1865 but to become yeoman farmers. It is true, of course, that the plantation survived , but not in its old forms with its large labor force of slaves. A bigger difference was the fact that cotton farmers now had to find some way to finance production. They were faced actually with the primary challenge of making a subsistence living from the soil, but even this required some kind of a system of capitalization. Farmers had no capital, no seed, fertilizer , or equipment with which to farm. They had no organized market on which to sell their produce if they grew it. In much of the region merchants suffered the same disaster as did their customers. They were without credit, and their store shelves stood barren of merchandise. Transportation facilities were so badly disrupted that shipment of goods was next to impossible. Goods themselves were difficult to obtain from Southern sources; thus it was necessary to turn to other sections for supplies. The booming Civil War economy had brought about the creation of great storehouses of goods in the North. There merchants and manufacturers were in search of new customers to take up the slack created by the coming of peace. One of the most serious mercantile losses to come out of the war for the South was the disappearance of the factorage system. No longer could factors find customers who could promise to meet their obligations within a year, or ever as for that matter. No longer was this unique system of agricultural supply and credit able to survive, yet its passing created an enormous vacuum which stifled Southern agricultural economy. This old system had depended upon the plantation, slavery, and cotton. Two of these were gone. In the factor’s place there appeared the wholesale merchants in Louisville , St. Louis, Baltimore, Charleston, Cincinnati, New Orleans, and Mobile . Many of these houses were operated by Jewish merchants who had either survived the war or were quick to see the opportunity for trade on a new basis of merchandising in the post-war South. This was especially true of merchants in the Ohio and Mississippi valleys, and in Charleston. The challenge to these merchants lay not so much in the field of merchandising as in helping to devise systems of capitalization and distribution which would work in a bankrupt region. The South was a rich potential market, but it had no fluid security and no money. No longer could wholesalers wait for customers to come to their doors. They now had to develop the trade themselves. It was...

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