Special Edition: The Turning Point of the War (July 1, 1862)
On July 1, 1862, Robert E. Lee’s last opportunity to ‘bag’ the Union Army of the Potomac came to an end at Malvern Hill. As Lee surely knew, his army had enjoyed tactical and numerical advantages on several occasions and had wasted multiple opportunities during the past week’s fighting to inflict a crippling blow against George McClellan’s army. However, each of these opportunities was lost due (mostly) to the ineffectiveness of Thomas J. ‘Stonewall’ Jackson, who was unable to replicate the magic of his Shenandoah Valley campaign. Yet, even while Lee pondered his next move, President Lincoln was able to create a new army of 50,000 men to threaten Richmond and Lee’s flank. In addition, Lincoln issued a call for 300,000 new volunteers, which quickly manifested itself in the Militia Act of 1862, signed three weeks later.
Among other things, the Militia Act authorized President Lincoln “to receive into the service of the United States, for the purpose of constructing intrenchments, or performing camp service, or any other labor, or any military or naval service for which they may be found competent, persons of African descent." It also stipulated that former slaves who enlisted would be granted freedom, “along with their mothers, wives, and children.” As a result, months before the Emancipation Proclamation, African-American units began forming in Kansas and in federally occupied areas of Louisiana and South Carolina.
This call for additional volunteers, combined with the Militia Act, ensured that the overwhelming manpower advantage enjoyed by the Union Army would continue. In addition, by beginning the process of admitting former slaves into the U.S. Army, Lincoln directly addressed the Achilles heel of the Confederacy—chattel slavery. It also exacerbated one of the greatest fears of the Confederate government, that of a great slave rebellion. As the war drags on, the Union Army will be continually strengthened by the addition of former slaves, while the steady decrease of their primary source of agricultural workers will hamper the South’s ability to feed and clothe their armies in the field.
On July 1, 1862, President Lincoln also signed the Revenue Act which created an Office of Internal Revenue, “specifically to collect taxes, including highly lucrative tariffs.” The Act “created a tax on virtually every document along with proprietary items including matches, perfume, and medicine.” It also levied a 3 percent tax on incomes between $600 and $10,000 and a 5 percent tax on incomes of more than $10,000, and within weeks former Massachusetts governor George Boutwell was sworn in as the first Commissioner of Internal Revenue. This Act highlighted the different approaches the Union and Confederate governments were taking to fund the war. While the U.S. Government was using taxation and issuing bonds to raise revenue, the Confederate government was relying on promissory notes and paper money, which were only backed by promises of Confederate military success. This all but assured the specter of high inflation in the South if, and when, the war begins to go poorly.
President Lincoln also signed the Pacific Railway Act on July 1, 1862. While the Confederate President was fighting for the survival of his government, Lincoln was building the framework for the construction of a “railroad and telegraph line from the Missouri River to the Pacific Ocean.” As the Homestead Act did in May, the passage of the Pacific Railway Act underscores the ability of the Federal government to continue to operate in a ‘normal’ fashion, even during wartime. The Railway Act designated the 32nd parallel as the initial transcontinental route and provided government bonds to fund the project and large grants of lands for rights-of-way. The Act also authorized two railroad companies, the Union Pacific and the Central Pacific, to construct the lines and attracted thousands of Irish, German, Italian, and Chinese immigrants to help build the railroad. Despite the great costs of the Civil War, the North had the economic strength and excess manpower to continue the process of westward expansion. In contrast, the Confederate government was forbidden by its constitution to “appropriate money for any internal improvement,” and lacked the industrial capacity to even adequately maintain the railroads in the South.
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