ECONOMIC CAUSES

Since its settlement, the southern United States had received most of its income from farming, which depended heavily on slave labor. By 1860 cotton—King Cotton, as it became known—was the chief crop of the South and totaled 57 percent of all U.S. exports. Largely because of the dominance of cotton, the South resisted the industrialization that swept the North in the 19th century.

Thus the South manufactured little, and most manufactured goods had to be purchased from the North or imported from overseas. Meanwhile, by the eve of the Civil War the North had become an established industrial society. For economic and moral reasons the North did not use slave labor, instead relying on its own workers and European immigrants to power its factories, build its railroads, and settle the West.

Northerners demanded high tariffs on imports to protect their goods from cheap foreign competition. The South, however, wanted just the opposite: low tariffs on the many goods it imported. The persistent conflict over the tariff was crucial because at the time, the federal government had few other sources of revenue—neither personal nor corporate income taxes existed.

Thus tariffs funded the turnpikes, railroads, and canals that were crucial to Northern industrialization and Western expansion. The South preferred to do without these improvements in return for lower tariffs. This conflict was never fully resolved until after the Civil War.