Historians Charles Beard and Mary Beard, writing in the 1920s, described the Civil War as “The Second American Revolution.” They believed that the Civil War started the United States on the path to industrialization, a development that transformed the face of American society. This may be an overstatement—the forces that gave rise to industrialization were already present in the United States before the war started. However, it is certainly the case that the Civil War sped up the move toward industrialization while solidifying the North’s dominance in American manufacturing.
In a wartime economy, some industries suffer while others prosper. The North’s largest industry at the start of the war was cotton textiles, but manufacturers of cotton goods saw a 74 percent decline in business during the war due to the loss of Southern raw material and Southern customers. Shoe manufacturers were also negatively affected by the loss of the Southern market, although to a lesser extent because military contracts made up for much of the shortfall. The profits of the coal and iron industries dropped precipitously in the first two years of the war before finally rebounding in 1863 and 1864.
Not all Northern industries struggled, however. War-related businesses naturally did well throughout the war. These included the manufacturers of gunpowder and firearms, wool clothing, leather, copper, and packaged foods. The strength of these industries allowed the North to produce 13 percent more goods in 1864 than the entire nation had produced in 1860. For the entire course of the war, there was actually a slight drop in national output, likely because more than one-third of the workforce was in the army. A burst of productivity in the 1870s made up for the shortfall, and by 1880 America’s level of production stood almost exactly where it would have if the Civil War had never happened.
Although the Civil War did not cause tremendous growth in the Northern economy, it did accelerate the process of industrialization. The transportation industry underwent a boom during the war. The four years of the war saw the construction of twice as many merchant boats as had been built in the four years before the war. At the same time, railroad traffic doubled, and thousands of new miles of track were built. These boats and RAILROADS would be utilized to move goods between markets in the postwar era and would therefore play an important part in the industrialized economy.
The demands of the Union army also helped to speed up the move toward mechanization and the factory system. For example, the need for millions of army uniforms transformed the clothing industry. The sewing machine had been invented in the 1850s, and the number of sewing machines in use in the North doubled between 1860 and 1865. As clothing production became increasingly mechanized, it also became standardized. The War Department provided manufacturers with a set of graduated measurements for soldiers, thus creating the concept of “sizes” for uniforms and, after the war, civilian clothes.
By compelling large numbers of Northern businessmen to expand transportation networks, invest in machinery, and adopt standardization, the Civil War helped hasten the onset of the industrial era in the North. In part, this was possible because the North had the capital resources and labor necessary to make such changes. The South, on the other hand, enjoyed no such advantages. More than 90 percent of the nation’s manufacturing capacity in 1860 was located in the North. The South had some modern manufacturing facilities, notably the Tredegar Iron Works in Virginia, but they were few in number. The North also had the majority of the nation’s capital in 1860. What capital the South did have was tied up in land and slaves and could not easily be converted into the equipment needed for manufacturing.
Given the scarcity of privately held factories in the South, the Confederate government was compelled to go into the manufacturing business for itself. By 1863, publicly owned firms were producing virtually every manufactured good needed to wage war—ships, guns, bullets, blankets, wagons, and uniforms. However, when the war ended and the Confederate government collapsed, these industries disappeared, and the South was once again left with almost no manufacturing capacity. Meanwhile, over the course of the war and Reconstruction, a major redistribution of wealth took place. The South had 30 percent of the nation’s wealth in 1860 but only 12 percent in 1870. The war had also caused the collapse of the Southern banking system. With no factories, no capital, and no source of credit, Southern businessmen could hardly hope to develop any sort of manufacturing capacity in the postwar era. While there were some Southern leaders who called for an industrialized “New South,” this was not an easily realized possibility, although cotton textile mills flourished in several Southern states by the 1880s.
The Civil War, then, did not spark a revolution. However, as Northern manufacturers struggled to be profitable and to respond to the needs of the Union army, they made choices that accelerated the pace of industrialization. They built more railroads, invested heavily in the new machinery that had been developed in the 1840s and 1850s, and utilized standardization with increasing frequency. Meanwhile, wealth flowed from South to North, creating an imbalance that would exist long after Reconstruction had ended. These trends would, in the late 19th century, culminate in an economy dominated by manufacturing and by the North.
Further reading: Fred Bateman and Thomas Weiss, A Deplorable Scarcity: The Failure of Industrialization in the Slave Economy (Chapel Hill: University of North Carolina Press, 1981); J. Matthew Gallman, The North Fights the Civil War: The Home Front (Chicago: I. R. Dee, 1994); Patrick O’Brien, The Economic Effects of the American Civil War (Basingstoke, UK.: Macmillan Education, 1988); Phillip Shaw Paludan, A People's Contest: The Union and Civil War, 1861-1865) (Lawrence: University Press of Kansas, 1996).
—Christopher Bates
World History
