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Confederate “State Socialism”

“The Stainless Banner”: The Second National Flag (1863–65) of the Confederate States of America had a pure white field

3,555 words

For the prequel to this article, see “The Confederate Revolution.”

In a short book published in 1971, University of Georgia history professor Emory M. Thomas examined The Confederacy as a Revolutionary Experience.

The Confederate revolution, Thomas maintains, occurred in two stages. 

The first consisted of an external revolution—secession from the Union, war, and the establishment of a new Confederate nation. This “conservative revolution” was spearheaded by classic revolutionaries in the tradition of 1776. The revolutionaries agitated for secession in order to conserve the Southern way of life. These “fire-eaters” or “radicals,” as historians call them, were active from 1820 on.

The second revolution was an “internal” social, economic, and political revolution inadvertently brought about by the demands of total war. It “displaced the basic institutions which had composed the antebellum Southern way of life.” (p. 57)

War-driven Confederate economic nationalism was “the most successful demonstration of State Socialism to be found up to the time in modern civilization.” (Quoting Louise B. Hill, State Socialism in the Confederate States of America, 1936, p. 3)

The partnership arrangement among the Davis administration, manufacturers, and railroads allowed the government to manage substantial segments of the wartime economy and make long strides toward national economic planning [an old Leftist euphemism for state socialism]. . . . The Confederate States moved faster toward economic nationalism than did the United States. (Thomas, p. 68)

The internal revolution was spearheaded by moderates who assumed control of the Confederate nation from the time of its formation. They displaced the original revolutionaries, who played little role in the new state.

This article explores primarily the second, internal, revolution as sketched by Emory Thomas in The Confederacy as a Revolutionary Experience. However, one remaining aspect of the external revolution remains to be discussed, the conduct of the rebellion itself.

The War

Commander in chief of the Confederacy Jefferson Davis was a West Point graduate and former military officer, US Secretary of War, US Congressman, and Senator.

“He not only knew the military mind,” Thomas writes, “he possessed one. And Davis very early gathered to him the best available men from the military establishment of the old Union.” (p. 43)

Civil War historians typically treat the conflict as a series of large set-piece battles. Innovative technology such as railroads, the telegraph, machine (Gatling) guns, observation balloons, submarines, ironclads, and land and water mines helped make it “the first modern war.”

Outgunned, outmanned, and out-financed from the beginning, however, Jefferson Davis scrapped his early preconceptions and adopted an “offensive-defense” strategy.

The strategy owed a great deal to the American Revolution, for in a basic sense the two rebellions were similar. Davis”plotted revolution in the tradition of his revolutionary forebears.” (p. 55)

For example, the Confederate navy was comprised largely of “water-borne guerrillas”—hit-and-run raiding craft and patriotic pirates, smugglers, and blockade runners (think Rhett Butler in Gone with the Wind).

Confederate armies sacrificed territory (a defensive strategy) for the opportunity to attack under favorable conditions (an offensive strategy). Southern resources did not permit sustained offensives in enemy country.

Some conventional units fought unconventional, revolutionary-style battles. Especially notable in this regard were units under the command of guerrilla tacticians such as J. E. B. Stuart, Nathan Bedford Forrest, and Stonewall Jackson. “At heart these men and others like them were revolutionaries.” (p. 54)

Morgan’s Raiders and Mosby’s Rangers are other examples.

The Confederate Congress offered landlocked partisan groups the same prize rules which governed captures at sea: partisans shared in the sale of captured enemy supplies, wagons, and weapons. Irregular warfare was adventurous and lucrative, and many Southerners formed guerrilla bands and partisan ranger outfits. (p. 53)

Morgan’s Raiders: General John Hunt Morgan inspects his troops, 1862

Much was created from scratch. The Confederate Chief of Ordnance wrote in 1864: “Where three years ago we were not making a pistol nor a saber, no shot nor shell (except at the Tredegar Works)—a pound of powder—we now make all these in quantities to meet the demands of our large armies.” (p. 88)

In 1865 Jefferson Davis still believed the Confederacy could outlive the demise of its field armies. He exhorted Southerners to take to the hills after the war and resist as long as necessary to secure independence.

This was strikingly similar to Hitler’s appeals to Germans at the end of WWII. Both examples illustrate the necessity of marrying iron determination to a realistic assessment of what is possible.

The Centralized State

The Southern leadership—national, state, and local—was compelled by the demands of total war, limited finances, and the lack of an industrial base to radically alter the Southern way of life. Government officials “reversed or seriously undermined virtually every tenet of the way of life they were supposedly defending.” (p. 134)

Despite firmly-held states’ rights convictions, the Confederate government transformed a states’ rights polity into a centralized nationalist state. The power of the central government was increased far beyond what was originally intended.

As a consequence, a system very similar to that of the wartime North evolved.

In recent years libertarian economist Thomas J. DiLorenzo has won notoriety for writing books (The Real Lincoln, Lincoln Unmasked) and articles (“Claremont’s Court Historians”) maintaining that Abraham Lincoln conducted an illegal war, created a centralized Northern state, and violated basic civil liberties.

The Southern Poverty Law Center, a Jewish anti-civil liberties group, has attacked DiLorenzo for such historical observations.

One of DiLorenzo’s major observations is that “Lincoln is on record opposing equality for blacks, and was a lifetime proponent of recolonizing slaves back to Africa. This is beyond dispute, even if the Lincoln partisans don’t like to talk about it. . . .Lincoln is on record time after time rejecting the idea of racial equality.”

In The Real Lincoln DiLorenzo adds, “It is conceivable that many white supremacists in the North (which included most of the population) nevertheless abhorred the institution of slavery.” (p. 32) (I.e., they were abolitionists, not race-mixers.)

These historically accurate observations, addressed to modern audiences, are intended by DiLorenzo to discredit Lincoln and Northerners respectively.

Most of DiLorenzo’s arguments against Lincoln apply to Jefferson Davis and the Confederacy. Both governments felt compelled to respond to the exigencies of the war in similar ways.

Despite constant feuding, the Confederate Congress never really denied President Davis anything he wanted. Though Davis employed the veto 39 times, it was overridden only once. The Administration embodied the popular will and retained the support of Southerners throughout the war. The Confederacy never spawned an opposition party.

Militia units tendered by state governors were not accepted in the traditional manner. Rather, militiamen were mustered into the Confederate States army and bound by oath to the nation rather than to the states they came from.

Likewise, materiel such as cannon and munitions belonged to the national army, not the states.

One-year volunteers provided military manpower during the first year of the war. As the enlistments ended, the Confederacy faced a severe manpower shortage. So, in April 1862 the Confederate Congress instituted the first military draft in North America—one year before the Union did so—enrolling white males aged 18–35 (subsequently lengthened to 17–50).

The creation of a national army and conscription were contrary to states’ rights and Southern individualism.

In February 1862, the Confederate Congress passed the Habeas Corpus Act “authorizing the president to suspend the writ of habeas corpus, thus invoking martial law.” (Lincoln’s suspension of habeas corpus in the North is one of the primary condemnations leveled against him by DiLorenzo.)

The Southern treatment of former 2-term US Congressman John Minor Botts (Whig-Va.) was analogous to the North’s treatment of US Congressman Clement L. Vallandigham (D.-Oh.).

However, unlike Lincoln, Jefferson Davis never shut down opposition newspapers, despite frequent, vociferous criticism of his Administration. Given the enormous significance and clear effectiveness of mass media control in contemporary societies, this is of key importance.

Thomas briefly describes the operation of martial law in the Confederate capital of Richmond, Virginia, noting, “The irony of a state rights confederation turning its capital into a police state requires no comment.” (p. 63)

Finally, a large confederal bureaucracy developed; Richmond, the capital, employed more civil servants than did the US government in Washington, DC.

Nationalization of the Economy

Through extensive regulation the Confederate States of America all but nationalized the Southern economy—an economic revolution.

Urbanization and industrialization expanded as the plantation economy withered. Cities swelled in size and importance.

The government established the Cotton Bureau, a cartel to regulate every aspect of the production, sale, and distribution of the South’s major commodity.

Beginning in 1862, Southern army commanders requisitioned food and forage from farms for troops and horses. Slaves, as property, were requisitioned for labor.

In Chapter 7, “Black Confederates: Slavery and Wartime,” Thomas sketches important changes that occurred to the institution of slavery during the war. Given its centrality to the Southern economy and way of life, the changes were by no means minor.

Perpetually short of funds, the Confederacy issued loans and bonds and printed money, generating severe inflation.

Monetary inflation may have been the single greatest weakness of the Confederacy, weakening the purchasing power of the government and destroying economic security for consumers.

Annual Confederate Inflation Rate, 1861–1865

In 1863 a graduated income tax was imposed, together with a “tax-in-kind” (TIK) on agricultural produce, requiring farmers to tithe 10% of their harvests to the government.

Cotton served as security for the Confederacy’s only substantial foreign loan, from the French-Jewish banking firm of Erlanger, Ltd. Its principal, German-born Jew Baron Frederic Emile d’Erlanger, in 1864 married the daughter of John Slidell, the former US Congressman and Senator from Louisiana who served as the CSA’s ambassador to France. The couple had four sons, all of whom were successful.

In 1860 more than 80 percent of US manufacturing was carried on in the North. The Confederate South lacked an industrial base and the necessary skills, raw materials, and transportation to effectively establish war industries.

Therefore, the Confederate War Department stimulated and subsidized the Southern war industry by rapidly establishing government-run factories, mines, arsenals, ordnance plants, and gunpowder works. Government-operated mines created virtual monopolies in the production of certain raw materials.

The War Department also controlled the labor supply, capped private profits, and regulated railroads.

Mobilization removed 850,000 men in the prime of life from productive economic activity, crippling the economy. The men went from being producers to consumers. Economically, the military consumes food, clothing, transportation, weaponry, etc. If intelligently used—and successful—it produces security. If ill-used, or a wartime loser, its voracious consumption produces nothing, and destroys wealth.

In a Southern agrarian society, agricultural production was not as helpful as had originally been assumed. The major crop, “King Cotton,” proved useless. It could not be eaten, and the South lacked the necessary factories to manufacture textiles. Tobacco, another staple commodity, also proved worthless.

Food shortages were severe. Lack of farmers meant that wives and children could not produce the necessary food crops. Many farms lay in the path of the contending armies, and crops and livestock that weren’t destroyed by marching and fighting were often seized by both combatants. Confederate soldiers had priority over civilians to available foodstuffs.

Southern rail and road transportation was inadequate to move what food was raised to the markets where it was needed.

Food shortages in Southern cities and towns reached crisis proportions. Prices soared and food riots erupted. “Nearly every diary or memoir of the period records privation and even famine. The wartime South proved unable to feed itself.” (p. 86)

Social Transformation

Overwhelmingly rural in 1860 (New Orleans was the only major metropolitan area), the Confederacy oversaw a commercial and manufacturing revolution, primarily in war-related industries, but also in basic consumer goods formerly obtained from the North and Europe.

During the war cities and towns increased in size and influence, initiating an “urban revolution.” Refugees migrated from the countryside to cities in large numbers. An incipient, class-conscious urban proletariat developed.

An editor wrote in 1863 that the capital was “no longer the Richmond of old, it is the Confederacy—the world. Here we have all kinds and classes of people—representatives of nearly every race under heaven.” (p. 98)

As during WWII, women were encouraged to take up many tasks formerly performed by husbands and sons now in the military.

Southern women “climbed down from their pedestals” and became refugees, prostitutes (p. 105), nurses, matrons, hospital administrators, factory workers, farm managers, spies, and smugglers.

“The transformation of Scarlett O’Hara in Gone with the Wind from scatter-brained belle to hard-eyed businesswoman is fiction, but undoubtedly had a basis in reality.” (p. 107)

As always in modern conflicts, large-scale travel and mixing by hundreds of thousands of military recruits lessened preexisting individualism and provincialism.

“For the first time in their lives many Southerners traveled more than a few miles from home, visited cities, and shared life with people other than neighbors and relatives,” imparting a new sense of “corporate identity.”

The planter aristocracy was modified as new people with little or no social standing rose to financial and social prominence through military service, government careers, and commerce and industry, creating a new Confederate social elite.

A statistical analysis of 585 leading Confederates concluded that the new leadership did not come from the planter class: “Many—in fact the overwhelming majority—had come from the lesser walks of life and had risen through merit or favoritism or luck to posts of power.” (William B. Hesseltine, Confederate Leaders in the New South, 1950, p. 4)

Of course, as previously noted, the ranks of the antebellum planter class itself had been fluid, for the most part not based on old money and distinguished family lineages.

The War Department established a policy, contrary to prior military and militia practice, of allowing units to elect their own officers. “The Confederacy, unique among nations at war, battled for its life with elected officers and a democratic army.” (p. 109)

Examples of the new “military aristocracy of merit” included Nathan Bedford Forrest, Stonewall Jackson, Jubal Early, and native Pennsylvanians John C. Pemberton and the “brilliant Chief of Ordnance” Josiah Gorgas.

Yet the army was simultaneously aristocratic. Members of the planter class often won the elections, and generals and officers of higher rank were not chosen democratically, but by the government—often from the old upper class. The Confederacy also relied heavily upon experienced military men, West Pointers and officers of the old US Army.

“Perhaps the strongest feature” of this aristocratic-meritocratic-democratic army “was its élan, its esprit, its unity.” (p. 114)

It would appear that the Southern military might provide useful lessons from a Movement point of view.

By 1865 the Confederate South had surrendered most of its cherished way of life and “revolutionized itself.”

The wartime Confederate state was, in Thomas’s view, the true, progressive crucible of Southernism. “For four brief years Southerners took charge of their own destiny. In so doing they tested their institutions and sacred cows, found them wanting, and redefined them.”

Thomas’s contention that Southerners were genuine revolutionaries in the tradition of the founders is persuasive. The founders were essentially conservative revolutionaries who viewed themselves as upholders of traditional liberties.

The Confederates were also regional secessionists who temporarily established an independent nation on American soil.

Total war socially transformed the South much as it did the North. A social revolution of sorts took place.

However, Thomas’s claim of an internal revolution, much less the establishment of “state socialism” (which he alludes to suggestively but does not insist upon), is less persuasive.

White Confederates and the “Dying Institution”

The social viability of chattel slavery had run its course by 1860. Even if had it survived for a few more decades, it was on the way out.

A “necessary evil” even to the Southerners of the founding generation, and only circuitously defensible (states’ rights, nullification) by intellectuals such as John C. Calhoun and the moderate leaders of the Confederacy, chattel slavery was by the mid-19th century no longer morally, politically, or economically workable.

Today, white racialists as radical as native Southerner William L. Pierce, the great-great-grandson of the wartime governor of Alabama and Attorney General of the Confederacy, and as moderate as the separatists in Orania,South Africa, share the conviction that importation into or inclusion of Africans in white societies is catastrophic for our people.

Chattel slavery was reprehensible on moral grounds and biologically and socially disastrous from a preservationist standpoint.

I have developed a curiosity, also, about the legal origins of chattel slavery. Did it derive, in whole or in part, from ancient or medieval Jewish commercial law, as the so-called “Curse of Ham,” the primary religious-ideological rationalization for African slavery, appears to have originated with Talmudic sages?

With or without the Civil War, chattel slavery was coming to an end. (Everywhere else in the hemisphere it was abolished peacefully.) The abolition of slavery would have radically changed the Confederate polity had it survived.

Thomas describes changes in attitude in the South that illustrate clearly the internal trend.

In 1863 a serious movement among Southern churches and church leaders led by Mississippi Presbyterian James A. Lyon began agitating for the reform of the slave system. As the war continued, the reform impulse gathered strength, resulting in state legislation liberalizing the laws of slavery. This movement may have signaled the beginning of the end.

Academic Bell Wiley believed Confederate slavery was a “dying institution” that ultimately would have been “reformed to death” by its friends (Southern Negroes, 1861–1865, 1938, p. 172).

The South ultimately lost the war because it was economically and demographically outmanned by the North—the same reason Germany lost WWII to the “Democrat”-Communist alliance.

By 1863 the Confederate manpower shortage was critical. To meet the crisis, Irish General Patrick Cleburne in 1864 presented a paper to fellow officers urging that a large force of slaves be armed, incorporated into the Confederate forces, and later freed as a reward for their military service.

Though Jefferson Davis suppressed Cleburne’s paper, the debate continued within the military. Soon a conference of Southern governors urged the same measures, and Jewish Secretary of State Judah P. Benjamin “carried on an active campaign” within the Administration to arm slaves. Finally, Robert E. Lee added his support.

Davis, the last to come around, allowed that “Should the alternative ever be presented of subjugation [military defeat] or of the employment of the slave as a soldier, there seems no reason to doubt what should then be our decision.”

The top Confederates, including Davis, Lee, Judah Benjamin and others, “recognized that should the slave soldiers eventually be part of a victorious army, freedom would be their only just reward.” (p. 130)

In March 1865 the Confederate Congress authorized the president to recruit 300,000 slave soldiers. (To provide an idea of scale, 850,000 white men served in the Confederate armed forces.)

Throughout the war, President Davis had unsuccessfully tried to win foreign backing from Britain and France, as Benjamin Franklin had (from France) during the Revolution.

Desperate for assistance, late in March 1865 he offered, in the name of the Confederacy, to emancipate all slaves in exchange for diplomatic recognition and aid. But by then the Confederacy was past saving, and neither European power was willing to recognize a moribund South.

As Thomas emphasizes, when forced to choose between slavery, “the chief object of the war” as one Mississippi newspaper put it, and independence, the South opted for independence. The Confederacy was willing to let slavery perish in order to preserve an independent, slave-free nation.

Thomas is therefore convinced that had a miracle intervened and the South won the war, the Confederate nation, thanks to the internal revolution, “would have resembled the prewar South in little more than name.”

But the social changes were forced upon leaders by the exigencies of total war. No one willed or planned them. Emergency measures were not intended to extend into peacetime. In that sense, the Civil War resembles other modern wars.

Only the likely abolition of slavery by Southerners themselves would have profoundly altered society. But that was bound to happen anyway.

Ten years after a devastating war and subjugation by Radical Reconstructionists, many old traditions were reestablished on a new footing, without chattel slavery.

Radical wartime social measures viewed as progressive by Emory Thomas were obliterated after the conquest. The North “eradicated the rebel nation.” The “good” internal revolution did not survive the destruction of the Confederate state:

Southern industry and cities were largely rubble. Social structure disappeared in individual struggles for survival. Slaves were freedmen by fiat of the Yankee. Few “nations” have suffered defeat more thorough than that of the rebel South. (p. 136)

Radical Reconstruction and occupation troops finished the destructive job.

Embittered by Reconstruction, Southerners erected a “New South” (Thomas’s term for the segregated South between 1877 and 1971) on the ruins of the Old.

The new, segregated South reinstituted white, conservative rule, states’ rights, “racial bondage,” agrarianism, and other conditions “rejected” by the wartime regime’s internal revolution.

The issue of race submerged class awareness on the part of poor and middle-class white men [who should, according to Thomas, have united with oppressed blacks against upper class whites]. The South remained predominantly rural and agricultural. Money and land raised up a New South aristocracy who longed for nothing so much as the brave old world, that mythical South that existed before. Most of the positive, substantive changes wrought during the Confederate experience drowned in a sea of “Bourbonism.” (p. 137)

Segregation and awareness of black-white racial differences were the key components of the new order, as they would have been in an independent Confederate nation.


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  1. Posted October 13, 2012 at 1:37 am | Permalink

    Thanks for yet another fascinating essay, Andrew. I am struck by two things, primarily. The first is that the CSA actually managed to last as long as it did, given its near-total unpreparedness for war and inequity in terms of men and materiel compared to the USA. The second is the demolishing of the traditional Southern way of life that you describe. If the CSA had won the war, and assuming that the old aristocracy and its traditions had not reasserted itself, I wonder if a post-war CSA would really have evolved differently from how the USA evolved. With its intent of abolishing slavery (I guess it depends on whether or not the ex-slaves would have been allowed to stay or not), its reliance on Jewish finance, its apparent tendency toward centralization (if this had been maintained after the war), and so forth, perhaps it wouldn’t have been so radically different after all.

    Speaking of the CSA as an experiment in socialism, I am reminded that George Fitzhugh – as I said before, the closest thing the ante-bellum South had to a political philosopher – published his major work, “Sociology for the South,” in the 1850s. It is regarded as the first work in the socialist tradition to have been written by an American, and in fact GF had to define sociology in his Introduction since no one knew what it meant yet in America at that time. (His socialism was one that was wedded to the continuation of slavery, however – extended to ALL races, including Whites.) Based on what you have written, it would seem that Fitzhugh was a harbinger of things to come.

    • Kerry Bolton
      Posted October 13, 2012 at 2:36 am | Permalink

      There was no ‘reliance on Jewish finance’ by the Confederacy. That is the significance of it. Unfortunately, the Right has a legacy of crack-brained or ill-informed writers who sought to show that Judah Benjamin was an agent for Rothschild, etc.

      • Fourmyle of Ceres
        Posted October 13, 2012 at 12:45 pm | Permalink

        Trust the writers of counter-currents to avoid the red herrings, and unsupported fantasies that were so much the heart and soul of Movement Past.

        Benjamin escaped to England with, literally, the clothes on his back and some spare change in his pockets. He was a brilliant legal scholar, and a more than able attorney. Yet, when studying to become a barrister (at Gray’s Inn, if memory serves), his diet was pretty much bread and cheese, so reduced were his circumstances. His political skills were first-rate – US Senator with “Slippery” Slidell – and he became a internationally recognized authority in the area of commercial instruments, with his textbook, “Benjamin on Sales,” being updated and remaining in print even today.

        I wrote a Note about the Erlanger Loan in school. Benjamin was furious that accepting the terms would show one and all that the CSA was profoundly ignorant as to financial affairs. (If memory serves, Slidell married an Erlanger. Fill in the blanks for yourself!

  2. Kerry Bolton
    Posted October 13, 2012 at 2:30 am | Permalink

    Very informative.
    The main reason for inflation seems to have been the flooding of counterfeit currency from the North. There is nothing inflationary about state currency per se, and quips about Zimbabwe and Weimer Germany and their bucket loads of currency is a red herring that is till being used by proponents of the status quo (most recently New Zealand Prime Minister and ex-merchant banker John Key, ridiculing the Green Party advocacy of an injection of state currency for rebuilding Christchurch) despite the glaring failure of the debt-finance system.
    The Erlanger loan was squeezed out by Judah Benjamin, who regarded the loans as usurious.
    Obviously the economic and fiancial system of the Confederacy merits closer examination as being a home-grown model for a resurgent America.

  3. Fragender
    Posted October 14, 2012 at 4:13 am | Permalink

    So Eustace Mullins is a crackpot in these parts?

    • Kerry Bolton
      Posted October 15, 2012 at 1:15 am | Permalink

      What were Eustace Mullin’s sources? William Guy Carr, if I recall correctly, even claimed that Benjamin was a “Rotschild relative.” Refer to my series at C-C, “Was the Confederacy a Tool of International Finance?”

  4. Gerald Martin
    Posted October 16, 2012 at 12:58 am | Permalink

    Good article. Read THE CONFEDERACY AS A REVOLUTIONARY EXPERIENCE years ago, and thought it a provocative contribution to the historiography. And overall pretty good, but flawed in its analysis of class & race. Also, there was considerably less movement towards a managerial, bourgeois ethic for the ruling class than Thomas avers, and the best single work on Southern psychology about these matters, before, during and after the war, is still Richard Weaver’s, THE SOUTHERN TRADITION AT BAY.

    Nevertheless, Prof. Thomas is an interesting character himself. In the occasional C-span Civil War panels on which he appears, he provides a refreshing contrast to the usual gang of Lincoln worshippers, PC enforcers, and negrophiles who make up the rest of the speakers table. Though giving an occasional half-hearted kowtow to the current zeitgeist on race, he always speaks with considerable eloquence and force on behalf of the people, soldiers, and leaders of the South, which is increasingly rare at such events.

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