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
Can there be a doubtful thoughts about it? Certainly the American Civil War was about the slavery issue… wasn’t it? Well actually, one of the greatest popular myths in American history is that the Civil War began over slavery and that Lincoln, the Great Emancipator, used a bloody struggle to break the chains of bondage that shackled over three million black Americans. Right before the war, the South had everything it could have wanted.
In 1860, the South held the Supreme Court and Lincoln and Congress were approving a constitutional amendment to keep slavery forever! What happened?
Let’s move the clock back to the year 1832. By that year the national debt left from the War of 1812 had been extinguished and the South saw no need to keep up the high import taxes which appeared to only raise prices for the South’s consumers. Either the South paid high import taxes on foreign goods or it purchased Northern manufactured goods at excessive prices. Either way, Southern money ended up in 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!
Consequently, in 1832 a convention was held in South Carolina to get rid of these federal import taxes. The South decided the tax was unconstitutional and gave the governor the power to to defy the enforcing of the import taxes instituted by the national government. It looked like a civil war was in the making. Cool heads prevailed, however, and the Great Compromise of 1833 lowered import taxes over the next few years to an area the South would tolerate. Go here if you want help with a modern-day Tax Return in Raleigh, NC.
Over the ensuing years, however, Northern commercial and manufacturing companies bullied 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 outstanding spokesperson, gave a speech to Congress. His speech spoke of 3 grievances of the South that may lead to secession from the Union and war. The first two involved fears concerning the erosion of power of the South in general and the the power of state government as well.
The third, and really the only solid grievance, was about taxation. In Calhoun’s view, national import taxes was a class legislation against the South. Huge amounts of taxation on the South created money that was spent in the North. The center of economic strength in the country was steadily changing strongly to the North. Calhoun spoke of secession if the taxes weren’t reduced. But what of the slavery issue? Well, in his campaign for the presidency in 1860, Lincoln repeatedly said he would not do anything about slavery in the South. Actually, most Northerners did not really care about black men in bondage, just as little as how much they worried about the Indian in the West or impoverished uneducated workers in factories. The majority of black slaves received substantially better quality treatment and more compassion than their working-class counterparts in the North. Lincoln, actually, told Southern slave-owners that run-away slaves would be caught. The Congress and then the Supreme Court (Dred Scott decision) continually affirmed that slavery was here to stay.
But, right as Lincoln was elected and Congress came together in 1861, they enacted new high import tariffs. Slavery was not the issue – higher import taxes were. In his inaugural address Lincoln said he would collect the customs in the South even if there was a secession!
Fort Sumter, at the entrance of the Charleston Harbor, began filling with federal troops to support the collection of the new taxes. The Civil War started in 1861 when South Carolinians shot at the federal garrison at Fort Sumter. The inevitable had been brewing for decades – but it was not about the slaves. It was over tax policy.
2 years after that, Lincoln issued the Emancipation Proclamation, and then only after repeated military defeats, as the last resort to rally the North to a worthwhile cause. With respect to the slave issue – the majority of the North didn’t care much about black people in bondage, any more than they cared of Native-Americans in the west and the poor illiterate workers in the factories. By and large, most black slaves received better treatment and more compassion than their impoverished counterparts in the North.
That’s it for the History of Taxes Series!
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