Views on the South and Civil War if CSA won, but later lost

Utter halt? Probably not. Slow the economy way down? Yes. Not only is the debt sky high but the railroads are getting worn out, many of the plantations have been looted, a large number of slaves escaped , many of your young men are dead etc. This is true as early as 1862.
I added an addendum to my last post where I provided the cotton exports from the OTL USA (which is essentially the CSA, for cotton-growing purposes) post-ACW. Do you have any numbers on how big you think the interest bill will be?
 

Spengler

Banned
I base this on Jared that foreign capital can't do anything with the slaves. It cannot export them, it could sell them to someone within the CSA but it cannot do anything with them. Now yes they could but Cotton, but cotton is increasingly a less valuable commodity like Tobacco is. The CSA just doesn't have the goods to be taking in alot of Capital as time goes on. About Noodles it ight have been the other thread he's been quite persistent lately about the CSA becoming this great power. Well Jared concerning Debt if the war goes past 1862 the CSA will have to begin to issue bonds that will have high premiums and it will have to raise taxes to deal with such bonds. Now in the long run it could pay them off, says twenty years but that puts them further behind.
 
Which were already over by that time. So they would just hand it back you are saying?

Yup. The point of the campaign was to take New Orleans and the mouth of the Mississippi to pressure the US into making peace and gain a tremendous bargaining chip at the Ghent negotiations. Since the treaty has been signed, that whole reason for taking and holding New Orleans is moot. Any benefit from trying to keep it would pale in comparison to the cost of continuing, restarting really, the war. At the very most you might see a supplement to the treaty where Britain makes some other gain in exchange for New Orleans, but I doubt they'd be tremendously significant. So yes, I think they would just hand it back.
 
I base this on Jared that foreign capital can't do anything with the slaves. It cannot export them, it could sell them to someone within the CSA but it cannot do anything with them. Now yes they could but Cotton, but cotton is increasingly a less valuable commodity like Tobacco is.

The yearly value of cotton exports in 1866-1875 was US$205 million. In terms of economies of the time, that was a huge amount of capital. Plenty of security which can be provided for foreign investment. Tobacco was also valuable, if secondary to cotton. Then there's actual physical ownership of what's produced: the factories, the railroads, etc, which is usually what pre-ACW investment was secured against (since British investors - for example - couldn't rely on reclaiming slaves).

About Noodles it ight have been the other thread he's been quite persistent lately about the CSA becoming this great power.
As may be. It was not brought up in this thread except by you, and it was not brought up at all by me. I'll thank you not to try to attribute suggestions to me when I have not made anything like them.

Well Jared concerning Debt if the war goes past 1862 the CSA will have to begin to issue bonds that will have high premiums and it will have to raise taxes to deal with such bonds. Now in the long run it could pay them off, says twenty years but that puts them further behind.
Numbers, please. How much debt, how much interest, so we can make some estimates of how much of a dampener the taxes would put on a hypothetical CSA post-war ecnomy. I've provided evidence of the size of the cotton market (not the CSA's full economy, but a major part), but no-one's providing any numbers on the debt other than "oh, it was big, it will cripple them". Perhaps it will, perhaps it won't, but I'd like to see some numbers rather than vague statements.
 
The yearly value of cotton exports in 1866-1875 was US$205 million. In terms of economies of the time, that was a huge amount of capital. Plenty of security which can be provided for foreign investment. Tobacco was also valuable, if secondary to cotton. Then there's actual physical ownership of what's produced: the factories, the railroads, etc, which is usually what pre-ACW investment was secured against (since British investors - for example - couldn't rely on reclaiming slaves).


As may be. It was not brought up in this thread except by you, and it was not brought up at all by me. I'll thank you not to try to attribute suggestions to me when I have not made anything like them.


Numbers, please. How much debt, how much interest, so we can make some estimates of how much of a dampener the taxes would put on a hypothetical CSA post-war ecnomy. I've provided evidence of the size of the cotton market (not the CSA's full economy, but a major part), but no-one's providing any numbers on the debt other than "oh, it was big, it will cripple them". Perhaps it will, perhaps it won't, but I'd like to see some numbers rather than vague statements.

At least $450 million in debt by 1862, $700 million in debt by 1863 and over a billion by 1864 and of course only part of the exports can go into the government's pockets and it of course doesn't count private and state debt which also soared..https://en.wikipedia.org/wiki/Economy_of_the_Confederate_States_of_America#Money
 
Note this is from 1864. Also if you used up your tries on the NYT use a proxy.

Funded debt............................. $297,871,650

Call certificates.......................... 89,206,770

Interest bearing Treasury notes......... 102,465,450

Not-interest bearing Treasury notes..... 720,898,095

Total...............................$1,210,441,965
At least $450 million in debt by 1862, $700 million in debt by 1863 and over a billion by 1864 and of course only part of the exports can go into the government's pockets and it of course doesn't count private and state debt which also soared..https://en.wikipedia.org/wiki/Economy_of_the_Confederate_States_of_America#Money

Thank you for these figures. It's not clear if those are in US$ or Confederate $, but I'll assume the former is more likely (and if accurate, worst case for the Confederacy). What's missing is the interest rates on this debt, which presumably varied between the kinds of debt. Various googlings have produced interest rates of different kinds of debt of somewhere between 3.5 and 8%, depending on the debt. For the sake of a back-of-the-envelope style of calculation I've gone with 6%, but I'm open to a more accurate figure, if known.

If an 1862 scenario (OP, however unlikely that might be), that leaves an interest bill of $27 million per year.
If an 1863 scenario, that leaves an interest bill of $42 million per year.
If an 1864 scenario, that leaves an interest bill of $72 million per year.

For paying that, well, cotton and other agricultural taxes are a big part. Certainly the CSA can claim only part of the value of those exports, but 10% of all agricultural produce (in kind) was the most successful war tax they passed in OTL, so I can see plenty of revenue coming from there - $10-20 million from cotton alone, depending on the level of the tax. Smaller amounts from other agricultural products.

On top of that, there's tariff revenue. The CS Treasury estimated that their (lower than pre-war) 10% tariff would fetch $25 million in its first year, but of course it brought in almost nothing because of the blockade. With peace returning, tariff revenues come with it, and that's probably not a bad ballpark figure. Also some level of tariffs on U.S. goods imported into the CSA (which never happened before). Call it, for the sake of argument, $30 million total.

There will also be some other taxes on top of that, of course, but tariffs and agricultural taxes are going to be the big two. $50 million per year in interest is manageable without crippling the CS economy, unless you think that a 10% tax on agriculture and 10% tariff is going to undo them. (I doubt that, but am open to other views). $100 million per year is going to make things harder. In other words, much depends on the actual interest rate in question, and when independence (somehow) occurs.
 
Thank you for these figures. It's not clear if those are in US$ or Confederate $, but I'll assume the former is more likely (and if accurate, worst case for the Confederacy). What's missing is the interest rates on this debt, which presumably varied between the kinds of debt. Various googlings have produced interest rates of different kinds of debt of somewhere between 3.5 and 8%, depending on the debt. For the sake of a back-of-the-envelope style of calculation I've gone with 6%, but I'm open to a more accurate figure, if known.

If an 1862 scenario (OP, however unlikely that might be), that leaves an interest bill of $27 million per year.
If an 1863 scenario, that leaves an interest bill of $42 million per year.
If an 1864 scenario, that leaves an interest bill of $72 million per year.

For paying that, well, cotton and other agricultural taxes are a big part. Certainly the CSA can claim only part of the value of those exports, but 10% of all agricultural produce (in kind) was the most successful war tax they passed in OTL, so I can see plenty of revenue coming from there - $10-20 million from cotton alone, depending on the level of the tax. Smaller amounts from other agricultural products.

On top of that, there's tariff revenue. The CS Treasury estimated that their (lower than pre-war) 10% tariff would fetch $25 million in its first year, but of course it brought in almost nothing because of the blockade. With peace returning, tariff revenues come with it, and that's probably not a bad ballpark figure. Also some level of tariffs on U.S. goods imported into the CSA (which never happened before). Call it, for the sake of argument, $30 million total.

There will also be some other taxes on top of that, of course, but tariffs and agricultural taxes are going to be the big two. $50 million per year in interest is manageable without crippling the CS economy, unless you think that a 10% tax on agriculture and 10% tariff is going to undo them. (I doubt that, but am open to other views). $100 million per year is going to make things harder. In other words, much depends on the actual interest rate in question, and when independence (somehow) occurs.

The US was paying 7.3% so you are well underestimating it. https://en.wikipedia.org/wiki/Treasury_Note_(19th_century)#Seven-Thirties
 
The US was paying 7.3% so you are well underestimating it. https://en.wikipedia.org/wiki/Treasury_Note_(19th_century)#Seven-Thirties
Not all of the debt was at that level, by any means. Some of the tranches of interest-bearing Treasury notes paid 4% (source: here).

Having checked a bit more, it turns out that all of those non-interest-bearing Treasury notes (~$720 million) were denominated in Confederate dollars (not US$). They paid the grand total of, well, zero percent interest (https://en.wikipedia.org/wiki/Confederate_States_dollar). The catch is that they were redeemable not too long after the war ended, so would naturally need to be repaid in some interest-bearing form - but I doubt it would be more than the 4% paid for the above treasury notes. Of course, being in Confederate dollars, they would be worth less than the US$ figures for cotton exports above, which would allow a correspondingly greater proportion of the interest bill to be paid from foreign tax revenues.

So those various rounds of Treasury notes ($820+ million of the 1864) debts will pay, at most, 4% interest. This will hurt, of course, but is not insurmountable.
 
Not all of the debt was at that level, by any means. Some of the tranches of interest-bearing Treasury notes paid 4% (source: here).

Having checked a bit more, it turns out that all of those non-interest-bearing Treasury notes (~$720 million) were denominated in Confederate dollars (not US$). They paid the grand total of, well, zero percent interest (https://en.wikipedia.org/wiki/Confederate_States_dollar). The catch is that they were redeemable not too long after the war ended, so would naturally need to be repaid in some interest-bearing form - but I doubt it would be more than the 4% paid for the above treasury notes. Of course, being in Confederate dollars, they would be worth less than the US$ figures for cotton exports above, which would allow a correspondingly greater proportion of the interest bill to be paid from foreign tax revenues.

So those various rounds of Treasury notes ($820+ million of the 1864) debts will pay, at most, 4% interest. This will hurt, of course, but is not insurmountable.

You are also overestimating cotton exports, the US government rebuilt railroads, gave rations to civilians , replaced worthless currency with US dollars, and paid all the military expenses including the Union soldier salaries that went straight into the Southern economy and wiped out all Southern government debt including state debt. This means that there will be more cotton than OTL that can't get to the ports or gets spoiled before it gets there, some of the slaves and other workers would be malnourished and die earlier than OTL from disease and certainly can't work as hard, a lot of capital will probably be used merely speculating instead of doing anything actually useful due to runaway to hyperinflation, and a lot of that capital will also be taken up to pay back state and planter debt. They were in debt to their eyebrows as well. Losses from bad infrastructure and decreased production would be high.
 
You are also overestimating cotton exports, the US government rebuilt railroads, gave rations to civilians , replaced worthless currency with US dollars, and paid all the military expenses including the Union soldier salaries that went straight into the Southern economy and wiped out all Southern government debt including state debt. This means that there will be more cotton than OTL that can't get to the ports or gets spoiled before it gets there, some of the slaves and other workers would be malnourished and die earlier than OTL from disease and certainly can't work as hard, a lot of capital will probably be used merely speculating instead of doing anything actually useful due to runaway to hyperinflation, and a lot of that capital will also be taken up to pay back state and planter debt. They were in debt to their eyebrows as well. Losses from bad infrastructure and decreased production would be high.

Swings and roundabouts. If the CSA wins - especially in the 1862 scenario of the OP, but even if by unspecified military victories they hold off the Union somehow in 1864 - then the destruction has been less than what took place in OTL. Especially since much of the destruction took place in the last twelve months of the war.

An independent CSA also means that the productivity in cotton stays higher. Freedom led to a collapse in the labour force participation rate as the former slaves (very sensibly) did not want husbands and (particularly) wives to work in plantation conditions, or at the same intensity (no gang system post-ACW). So even a smaller population will still be more productive in cotton agriculture than in OTL.

Which is not to say that life in an independent CSA will be fun - even for the whites - but there were factors pushing both ways.
 

Saphroneth

Banned
I don't think that the South would be a hellhole, but the main reason for this is that I think it'd be basically forced to reform in many ways - judging the CSA of 1914 by the CSA of 1864 is like judging the US of 1833 by the US of 1783. (And, of course, a CSA independent in 1862 is fluid in nature.)

An independent CSA is also a slaving power without the ability to resist Lord Pumicestone's Gunboat Diplomacy (TM) so that might be fun.
Doubt a reannexation war would take place though - within not very many years the attitude might well be "good riddance" in the North.
 
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