Was Henry Ford right? Is history bunk?

A first edition of John F. Kennedy’s Profiles in Courage, inscribed by the author, realized $7,500 at a September 2018 Heritage auction.

By Jim O’Neal

Among the towering figures of the Civil War, none is more enigmatic than General William Tecumseh Sherman.

Widely denounced as ruthlessly destructive for his infamous March to the Sea across Georgia, Sherman was a brilliant commander who helped bring the bloody war to a decisive end. His legacy of “total war” against anyone and everyone (even unarmed civilians) has haunted many Americans and military leaders. It has no parallel in U.S. military history in terms of ferocity or effectiveness.

Sherman (1820-1891) was massively paranoid due to a catastrophic event when he was 9 years old. His father, apparently very successful, suddenly went into bankruptcy and then died … leaving the family penniless and in chaos. His decision to do whatever necessary to restore order and harmony to the Union was rooted in his compulsion for normalcy.

Psychobabble aside, I tend to agree with the following: “The historians of the future will note his shortcomings. Not captiously, but in the kind spirit of impartial justice he will set them down to draw the perfect balance of his character. Let him deduct them from the qualities that mark his distinction, and we shall still see William Tecumseh Sherman looming up a superb and colossal figure in the generation in which he lived,” said General F.C. Winkler, addressing the Army of the Cumberland in the year Sherman died.

Edwin McMasters Stanton (1814-69) became Attorney General for President James Buchanan the day Major Robert Anderson moved his federal troops to Fort Sumter, S.C. This action was viewed as a quasi act-of-war and South Carolina issued an “ordinance of secession.” Later, Stanton would become Abraham Lincoln’s War Secretary and General-in-Chief, replacing General George McClellan due to “inaction.” After Lincoln’s assassination, he became the temporary de facto head of the government as Andrew Johnson was paralyzed in a state of inaction and Congress was not in session.

A man of action, Stanton mobilized the hunt for John Wilkes Booth and all suspected conspirators. All but three were hanged after a swift military tribunal found them guilty. The Stanton role was played by Kevin Kline in the 2010 movie The Conspirator, directed by Robert Redford. Robin Wright played Mary Surratt, the first woman executed by the United States. After the trial, Stanton had a contentious role in President Johnson’s Cabinet, despite their intense mutual dislike.

Johnson (1808-1875) was the only member of the U.S. Senate from a seceding state (Tennessee) to remain loyal to the Union. Hoping to make an example to undermine the Confederacy, Lincoln designated him a brigadier general of volunteers and appointed him military governor of the state with instructions to form a government and return to the Union. The best Johnson could do was declare himself the leading Unionist of the South. Lincoln was expecting a difficult re-election in 1864 and Johnson was selected as vice president in the hope he could attract Southern Democratic votes. They were nominated in June and elected in November. Johnson botched his inauguration by getting drunk; his oath of office was a rambling, incoherent speech. It was so humiliating that he left town for a week. Upon his discreet return, accounts described him as the “invisible man.” Six short weeks later, he would be president of the United States.

The lives of these three men would become forever intertwined in a fascinating series of events.

On April 9, 1865, at the Appomattox Court House, Robert E. Lee (1807-1870) surrendered the Army of Northern Virginia to General Ulysses S. Grant (1822-1885), who accepted the surrender under terms that were considered generous. President Lincoln accepted them since he was still apprehensive about the rest of the Southern troops.

Three Confederate generals – Joe Johnston, Edmund Kirby Smith and Nathan Bedford Forrest – were still on the loose. Lincoln and Grant feared they would form guerilla units. The war could then theoretically last several more years.

However, after Lincoln’s assassination on April 15, Johnston followed Lee’s action and surrendered his troops to General Sherman. Their first meeting was similar to Grant/Lee, except without aides and note-takers (and the eyes of history). Sherman offered to accept Johnston’s surrender on the same terms as those give to Lee. Surprisingly, Johnston demurred and countered with a stunning proposal to make it a “universal surrender” – thereby surrendering all Southern forces to the Rio Grande. In short, it would end the war once and for all.

When Sherman agreed and sent it forward, President Johnson and the entire Cabinet were furious. They suspected Sherman of a conspiracy to take over the entire country or, at a minimum, position himself for the 1868 presidential election. It took Grant 10 days of diplomacy to settle the issue, but exposed a deep rift between President Johnson and Secretary Stanton.

In the end, when Johnson tried to fire Stanton, the Republican Congress impeached the president for “high crimes and misdemeanors.” He was famously acquitted by one vote (twice) by Senator Edmund G. Ross of Kansas. Interestingly, Ross was among the eight men profiled in the 1957 Pulitzer Prize-winning book Profiles in Courage “by” John F. Kennedy.

Critics have claimed Ross was bribed for his vote to acquit … and that Kennedy’s speechwriter and close adviser Ted Sorensen had ghostwritten the JFK book. Even Eleanor Roosevelt weighed in, famously quipping, “I wish that Kennedy had a little less profile and more courage.”

Perhaps Henry Ford was right. History is bunk!

Intelligent Collector blogger JIM O’NEAL is an avid collector and history buff. He is president and CEO of Frito-Lay International [retired] and earlier served as chair and CEO of PepsiCo Restaurants International [KFC Pizza Hut and Taco Bell].

It’s that time of year again … thinking about taxes

An editorial cartoon by Winsor McCay, circa 1925, protesting Congress “milking” income taxes while ignoring business taxes, sold for $10,800 at a November 2018 Heritage auction.

By Jim O’Neal

U.S. Rep. Schuyler Colfax of Indiana described the issue this way: “The most odious tax we can levy is going to be a tax on land. I cannot go home and tell my constituents that I voted for a bill that would allow a man, a millionaire, who has put his entire property into stock, to be exempt from taxation, while a farmer who lives by his side must pay a tax!” Colfax (1823-1885), who would later become one of only two men (with John Nance Garner) to be both speaker of the house and vice president, had a different proposal: Put a tax on stocks, bonds, mortgages and interest. A de facto income tax.

There was ample precedent for an income tax. England imposed one in 1799 and various states – which relied primarily on estate taxes – had begun taxing income in the 1840s. By 1850, some states had income taxes with high exemptions and low rates that graduated based on the wealth of the taxpayer. They didn’t raise much revenue, but were viewed as a way of taxing any wealth that escaped common real estate taxes. Colfax prevailed and the Ways and Means Committee dropped the property tax and replaced it with “direct taxation upon personal income or wealth.”

The only issues remaining were the constitutional restrictions on direct taxes, except in proportion to population (i.e. different tax rates for different states). The solution was simple. Call the new taxes something other than a direct tax and “impose the burden on the people equally in proportion to their ability to pay.” An amendment was adopted to impose a 3 percent tax on income over $600 a year and a luxury tax on alcohol and luxury goods.

The Senate went one step further with a 5 percent tax on income over $1,000. Eventually, they compromised on 3 percent for income over $800. At last, said The New York Herald, millionaires would contribute a fair proportion of their wealth to the support of the national government. Inequality would soon be a relic of the past and every man would pay according to his ability!

The time was early 1862 and Secretary of the Treasury Salmon Portland Chase realized he had grossly underestimated the cost of the Civil War. After the embarrassment at Bull Run and a reassessment of Gen. George McClellan’s preference to train his troops rather than engage the South in battle, a new estimate of the first year’s cost was a staggering $530 million. Chase doubted that merely labeling the new income tax an “indirect tax” was constitutional. More importantly, Congress had neglected to establish any means for collecting or enforcement of the new tax. The decision was made to view the tax legislation as simply a recommendation and everyone conveniently ignored it.

However, this left the Treasury with an urgent need to start borrowing money to fund the war effort and the challenge was growing more daunting each day. Treasury funds were facing a virtual depletion in a matter of weeks and American banks were adamant that the Union raise taxes rather than expect more loans. Without new revenues, the Union was in peril and the urgency was significant. President Lincoln found it convenient to cede authority to Chase and plead ignorance whenever the issue of finance was raised.

An earlier gambit in late 1861 to raise $150 million through a consortium of banks had failed when debt instruments were only partially subscribed to and government gold supplies were totally inadequate to cover the mounting financial needs. Trapped without any viable traditional options, Lincoln and Chase broke with longstanding traditions and accepted the idea to simply print the money needed. Congress passed the Legal Tender Act of 1862, turned on the printing presses and cranked out $150 million that the government declared as legal tender for private and public debts. An important proviso of the new “green backs” was that they were not redeemable for gold or silver and not for payment of customs duty or federal bonds and notes.

Most estimates for the cost of the war (1861-65) range from $6.2 billion for the Union and at least $2 billion for the South. These little wars can become very expensive if allowed to continue … a lesson we have learned once again in the Middle East (estimated at $80 billion “tops” … to actual $3 trillion and growing). But if you own a printing press, no problem.

In 1894, Congress tried to introduce an income tax of 2 percent on earnings over $4,000, but the Supreme Court ruled it unconstitutional. Income tax would not become a regular part of everyday life until 1914. However, once it did, the battles over taxes versus government spending (and who should pay) has become de rigueur.

“Don’t tax you. Don’t tax me. Tax that guy behind the tree.”

Intelligent Collector blogger JIM O’NEAL is an avid collector and history buff. He is president and CEO of Frito-Lay International [retired] and earlier served as chair and CEO of PepsiCo Restaurants International [KFC Pizza Hut and Taco Bell].

How did cotton farmers give the Union a run for its money?

A three-piece coin silver coffee set, circa 1855, that belonged to Jefferson Davis and his wife sold for $28,680 at a June 2013 Heritage auction.

By Jim O’Neal

Newly elected President Franklin Pierce quickly selected his Cabinet and strategically picked a Southern Senator, Jefferson Davis of Mississippi, to be his Secretary of War in 1853. Davis would become president as well, as the first and only president of the Confederate States of America (1861-65).

Jeff Davis, like so many others in the South, did not support the secessionist movement, since he was convinced the North would not allow this to occur peacefully. However, he was also convinced that each state was sovereign and had an unquestioned right to secede. When war finally came, loyalty to state was an easy choice to make, irrespective of personal views on slavery.

President Davis had an extensive military career and his four years as Secretary of War made him fully aware of the North’s vastly superior military and industrial power. Further, there were 21 million people in the North (mostly white), a 2-to-1 advantage over the South, which had several million slaves. Nevertheless, on April 29, 1861, Davis requested an Army of 100,000 volunteers, knowing full well it would be difficult to equip and arm them on a sustainable basis.

Another man familiar with this significant issue was Colonel Josiah Gorgas, head of the Confederate Ordnance Bureau. Gorgas had three stark sources of supply for the Confederate armed forces: inventory (on hand), home production, and foreign imports. By using arms seized from federal arsenals, Gorgas had (barely) enough weapons to outfit the initial 100,000 forces called out by President Davis. Then he turned his full attention to the future.

Unlike others in the South, Gorgas was savvy enough to know that the war would not be over quickly and realized his meager on-hand stocks of munitions would soon disappear. Given enough time, he planned to establish munitions plants that would make the new nation self-sustainable, but until then, “certain articles of prime necessity” would have to be imported from Europe. In April 1861, he dispatched Captain Caleb Huse to Great Britain to set up a purchasing arrangement to obtain foreign supplies. Only two things went wrong. First, no local munitions were ever produced and no supply lines from Europe were set up because the funding strategy failed due to “King Cotton.”

King Cotton was a political and economic theory based on the coercive power of Southern cotton. The British textile industry imported 80 percent of the South’s cotton. Deny them this supply and the severe impact on the British economy would force them to intervene in the war to help the South. The second tenet was that Northern textile mills were reliant on Southern cotton and starving them would disrupt the Northern economy as well.

Then the South curiously imposed an embargo on cotton shipments in the summer of 1861 and, although designed to bring the British into the war, really only deprived the European group of the funds to buy imported supplies.

The obvious question is how did this small group of cotton farmers … with limited supplies and munitions and a failed strategy to obtain more … fight a war against an armed group backed by an industrial powerhouse, and manage to last four years while inflicting great losses and sustaining even greater losses of lives and property?

My simplistic answer:

  1. President Lincoln and his generals (especially George McClellan) were not focused on the total destruction of the enemy (hopeful of coaxing them back into the Union).
  2. They were interested in winning battles rather than controlling territory.
  3. They avoided destroying infrastructure (until William Tecumseh Sherman demonstrated its benefits).
  4. The South was fighting for its future. I see similarities to both Vietnam and Afghanistan … people who would never surrender and, as the Taliban explained, “You have the watches. We have the time.”

Thank the Lord for generals Grant and Sherman.

JIM O’NEAL is an avid collector and history buff. He is president and CEO of Frito-Lay International [retired] and earlier served as chair and CEO of PepsiCo Restaurants International [KFC Pizza Hut and Taco Bell].

If President Jackson had Followed Through with a Threat…

This U.S. Colt Model 1877 Bulldog Gatling Gun, with five 18-inch barrels secured in brass casement, realized $395,000 at a December 2014 Heritage auction.

“An army travels on its stomach.”

By Jim O’Neal

Both Frederick the Great and Napoleon Bonaparte are credited with aphorisms similar to this theme intended to emphasize the concept that a well-provisioned military is critical to its performance. In 1775, France offered 10,000 francs to anyone who could improve this persistent problem. In 1809, a confectioner named Nicolas Appert claimed the prize by inventing a heating, boiling and sealing system that preserved food similar to modern technology.

During the Revolutionary War, General Washington had to contend with this issue, as well as uniforms and ordnance (e.g. arms, powder and shot), which were essential to killing and capturing the British enemies. Responsibilities were far too dispersed and decision-making overly reliant on untrained personnel.

By the dawn of the War of 1812, the War Department convinced Congress that all these activities should be consolidated under experienced military personnel. On May 14, 1812, the U.S. Army Ordnance Corps was established. Over the past 200-plus years, 41 different men (mostly generals) have held the title of Army Chief of Ordnance. The system has evolved slowly and is regarded as a highly effective organization at the center of military actions in many parts of the world.

However, when the Civil War started in 1861, the man in charge was General James Wolfe Ripley (1794-1870), a hardheaded, overworked old veteran that Andrew Jackson had once threatened to hang for disobedience during the war with the Creek Indians. Ripley believed that the North would make this a short war and all they needed was an ample supply of orthodox weapons. He flatly refused to authorize the purchase of additional rifle-muskets for the infantry; primarily because of a large inventory of smooth bore muskets in various U.S. ordnance centers. Furthermore, he adamantly refused to allow the introduction of the more modern breech-loading repeating rifles due to a bizarre belief that ammunition would be wasted.

After two years of defiantly resisting the acquisition of new, modern weaponry, he was forced to retire. He was derided by the press as an old foggy, while some military historians claim he was personally responsible for extending the war by two years – a staggering indictment of enormous significance if in fact true!

One prominent example occurred in early June 1861 when President Lincoln met the first-known salesman of machine guns: J.D. Mills of New York, who performed a demonstration in the loft of a carriage shop near the Willard Hotel. Lincoln was so impressed that a second demonstration was held for the president, five generals and three Cabinet members. The generals were equally impressed and ready to place an order on the spot. But, Ripley stubbornly managed to delay any action.

Lincoln was also stubborn and personally ordered 10 guns from Mills for $1,300 each without consulting anyone. It was the first machine gun order in history.

Then, on Dec. 18, 1861, General George McClellan bought 50 of the guns on a cost-plus basis for $750 each. Two weeks later, a pair of these guns debuted in the field under Colonel John Geary, a veteran of the Mexican War, the first mayor of San Francisco and, later, governor of both Kansas and Pennsylvania. Surprisingly, he wrote a letter saying they were “inefficient and unsafe to the operators.” But the colorful explorer General John C. Fremont, who commanded in West Virginia, sent an urgent dispatch to Ripley demanding 16 of the new machine guns.

Ripley characteristically replied:

“Have no Union Repeating Guns on hand and am not aware that any have been ordered.”

After several other tests produced mixed results, Scientific American wrote a requiem for the weapon, saying, “They had proved to be of no practical value to the Army of the Potomac and are now laid up in a storehouse in Washington.”

Then, belatedly, came a gifted inventor, Richard J. Gatling, who patented a six-barrel machine gun on Nov. 4, 1862. Gatling tried to interest Lincoln, who had now turned to other new weapons. However, some managed to get into service and three were used to help guard The New York Times building in the draft riots of July 1863. The guns eventually made Gatling rich and famous, but it was more than a year after the end of the war – Aug. 14, 1866 – when the U.S. Army became the first to adopt a machine gun … Gatlings!

It is always fun to consider counterfactuals (i.e. expressing what might have happened under different circumstances). In this case, if Andrew Jackson had hanged Ripley, then the North would have had vastly superior weaponry – especially the machine gun – and the war would have ended two years earlier. Many battles would have been avoided … Gettysburg … Sherman’s March to the Sea. Lincoln would have made a quick peace, thereby avoiding the assassination on April 14, 1865.

If … if … if …

Intelligent Collector blogger JIM O’NEAL is an avid collector and history buff. He is president and CEO of Frito-Lay International [retired] and earlier served as chair and CEO of PepsiCo Restaurants International [KFC Pizza Hut and Taco Bell].