rich, and its accumulated resources had not for two generations been subjected by either the national or state governments to extraordinary taxation. Wealth, moreover, was very uniformly distributed, and the people pointed with pride to the annually increasing receipts of revenue under the new system; which, starting with $41,000,000 of internal revenue in 1863, rose rapidly to $117,000,000 in 1864, $211,000,000 in 1865, and culminated in 1866 with the large sum of $310,000,000, making the total revenue for that year, drawn from all sources by so-called taxation, $559,000,000, the largest sum previously contributed in any one year for the support of any Government by the free consent of its people. So long, moreover, as the war lasted, the attempts to evade taxation by illicit methods were exceptional and in amount inconsiderable. The demand for most manufactured and agricultural products, owing to the enormous consumption of the armies and the withdrawal of labor from its accustomed vocations by enlistments, was fully equal to or in excess of supply. Prices rose rapidly with every increasing taxation or additional issues of paper money,[1] and under such circumstances the fiscal requirements of the war were not regarded by the majority of producers as oppressive. But, on the contrary, counting the taxes as elements of cost and reckoning profit as a percentage of the whole cost, it was generally the case that the aggregate profits of the producer were actually enhanced by reason of the taxes, to an extent considerably greater than they would have been had no taxes whatever been collected. Indeed, it was not infrequently the case that the manufacturers themselves were the most strenuous advocates for continued and rapidly increasing taxation, with a view of realizing thereby, through an advance in prices, large additional profits on products, or constituents of products, previously assessed or imported at lower rates of (customs) duties, and to bring about such advances influence and money were used without scruple.
- ↑ Among the absurd theories put forth in justification of an extravagant issue of (irredeemable) paper money was a favorite one, that such a policy was a matter of necessity to make money easy, in order that the securities (bonds) representing Government loans should be easily floated; the one uppermost idea in the heads of the Government officials having been, apparently, that in the floating thus contrived, the bonds alone would possess the property of buoyaney. But in this they were mistaken. The bonds indeed floated, but everything else floated with them; or, to borrow the language of a writer of the period (who criticised this experience from the humorous point of view), "the bonds were floated, but by just about the same operation as that by which things are floated in the suburbs of a town or city submerged in a heavy freshet—hencoops floated, cellars floated, streets floated, barge houses and outhouses floated, stray children and first floors floated, all creation floated and floated together." The market for five-twenties was made easy, the market for flour, beef, cotton, and military stores, of which the Government was compelled to purchase immense quantities, was made particularly easy. The whole country was put under water and remained so for a considerable period after the war terminated.
