Doug Casey on Civil War, Past and Potential

(Interviewed by Louis James, Editor, International Speculator)

L: So Doug, we’re on the cusp of a major turning point of U.S. Federal Reserve policy. “QE or not QE?”, that is the question. What do you think, is The Bernanke going to pull the handle on the toilet he’s thrown the dollar into, or let it mellow for a while?

Doug: I think he’ll be forced to pull the handle, and create trillions more dollars. The government has over a trillion of debt it has to roll over in the months to come, plus it has to finance a trillion-dollar deficit – at a minimum. The Chinese and the Japanese want to get rid of the paper they have – they’re not going to buy more. The only logical buyer is the Fed, so the dollar’s fate is sealed, as far as I’m concerned. Meanwhile, there’s something else important on my mind I’d like to talk about: the U.S. so-called Civil War.

L: [Blinks] Ah… Okay. Why now?

Doug: Several reasons. For one thing, we’ve just passed the sesquicentennial, or 150^th anniversary of its start. For another, it’s one of the most misunderstood events in American – and world – history, with consequences that still affect us today. And also, because we might be within a few years of seeing trouble on that level in the U.S. again.

L: Are you saying the economic crisis will turn into a revolution?

Doug: No, not necessarily, but it could. I think Stephen Jay Gould was right with his concept of punctuated equilibrium in terms of geological history. Basically, it holds that things progress very slowly for long periods of time, then evolve very quickly after some catastrophic event upsets the balance. You can make the case that human history is like that too. A good example is France of 1789. Nothing had really changed, politically, for centuries. Then a tipping point was reached, and the totally dysfunctional and corrupt monarchy was overthrown. Unfortunately, it was replaced with something even worse – Robespierre and the Terror – and then Napoleon, who was really just a beta version of Hitler or Stalin.

Anyway, things can change rapidly and radically when they reach a certain point. It’s like water; when it heats to 212° Fahrenheit, it changes into steam, which is totally different. I think a case can be made that we may be at a point like that now in the U.S. I think that 1861-1865 was like that for the U.S as well. Anyway, today’s world is a different topic. Let’s retro-rock for the moment.

L: Right then; where to start?

Doug: First, as always, with definitions. It’s incorrect to call it a “civil war.”

L: Can a war ever be civil, anyway?

Doug: No, but that’s not the point. A civil war is a conflict between two factions for control over the government. The Spanish Civil War of the 1930s was a real civil war. The unpleasantness of 1861-65 in America wasn’t. It was a war of secession – albeit a failed one. The Confederates never wanted to take over the government in Washington. To the contrary, they wanted no part of it.

L: Or as L. Neil Smith puts it, it was the “Second American Revolution.”

Doug: That’s a good way to look at it as well. Just as the 13 colonies wanted to shake off their rulers in London in 1776, four-score and five years later the 11 states of the South wanted to shake off their rulers in DC. In 1865, however, the wrong side won.

L: I understand what you mean about the wrong side winning, but many of our readers don’t share our context. Honest Abe freed the slaves. “A house divided cannot stand.” America wouldn’t exist today – QED.

Doug: To the victors go the spoils, but what’s more important, the writing of the history books. A whole complex of myth has been created about the War Between the States, and it’s politically incorrect to hold that there was any justice to the Southern cause. As with most everything everyone believes, a great deal of it is inaccurate – sometimes wildly inaccurate, or even the complete opposite of accurate.

First, Honest Abe (who we debunked a little in our conversation on presidents) didn’t care about the plight of the slaves. He did not free them right away, and when he did free them, his “Emancipation Proclamation” did so only in the South. He was losing an unpopular war – his move was a desperate attempt to incite insurrection in the south, and thereby debilitate his enemy. So, although slavery was a bone of contention, it was only one cause for the war. Myth incorrectly portrays it as the cause. That makes the victors look righteous. More important, and basic, were the economic causes. The U.S. had significant tariffs on imported machinery and goods, which benefited Northern manufacturers and penalized Southern planters. I urge anyone who’s interested in the whole area to get Lincoln Unmasked by Thomas DiLorenzo.

Second, a house divided should not stand. The argument was that America needed to remain one strong country to fight off powerful European nations that might turn hostile. That’s bunk. America had already fought off the mighty British Empire twice, and Europe – as always – was embroiled in its own problems. If peaceful secession had been allowed, the two countries would have been each other’s largest trading partners and allies. But even if the danger of foreign aggression had been real, it would not justify forcibly keeping people in a union they no longer wanted to be part of. It’s like a husband forcing a wife he loathes – and who despises him – to stay married to him because their crops will fail if they don’t work together on the farm. Other solutions could be found. But even if true, nothing justifies the use of force on someone who does not consent and does not aggress.

L: Well, the South did start the fight by firing on Ft. Sumter.

Doug: Yes – a stupid move. If they had just gone about their business, and waited for the North to fire the first shots, people around the world would have seen it as they themselves described it: the “War of Northern Aggression.” Hubris is the root cause of so many unnecessary failures throughout history. Hubris was behind the first battle of Ft. Sumter. Anyway, even though nobody was killed in the battle, it inflamed the North, and the war was on. And it’s very hard for a small agrarian society to beat a large industrial society.

But the point I was making was a matter of principle – the right of secession. I have zero inclination to defend the South in any other way. The Confederate government turned the South into a police state, just as the Federals did the North. But they had a right to secede. If any group of people decides to leave a larger group, that is not aggression and there is no ethical way to stop them. Secession may have costs, and there may be contractual obligations to be dealt with, but secession itself is not violence.

L: I would call it a fundamental human right. No one should be forced to be part of a group they don’t want to belong to. The same is true if it’s a marriage, a church, a labor union, or a nation.

Doug: Right. So, if the South had been allowed to secede, there would have been two Americas, the USA and the CSA. If that had happened, the enormous loss of life and destruction of property would have been avoided. Both North and South would have been far richer and more free – and the South would have avoided being a backwater for hillbillies for the next century. The war was a total disaster in every way, and if Europeans or others had wanted to attack, the war so weakened America, it actually created the most appealing invitation possible to do so.

Getting back to the point about Honest Abe, if the South had split off, slavery wouldn’t have lasted long anyway. It was an uneconomic, dying institution. Chattel slavery is an economic institution, not to be confused with the abduction and imprisonment of individuals for other criminal purposes. It only works for brute labor – in other words, in an agrarian economy. The industrial age put an end to slavery the world over – I think Brazil was the last to give it up, in 1888. It would have happened even sooner in the South. So the war was unnecessary and pointless from every angle.

L: Okay, but you spoke of lingering effects... This is all very interesting, but why does it matter now?

Doug: Well, principles always matter, and I do believe in the right to secession. Oddly, so does the U.S. government, when it suits it – when it comes to other peoples in far-off lands, like Kosovo and Sudan. Consistency has never been Uncle Sam’s strong suit. But to answer your question, there are two things that I think are important legacies that may become even more important in the years to come.

First is that since the slavery issue was settled by force, instead of by consensus, it wasn’t truly settled – one side’s views were imposed on the other’s by force, and, predictably, the losers dug their heels in and did everything possible to resist the foreign solution. That resulted in the Jim Crow laws, the Ku Klux Klan, and general race hatred that bedeviled the former slaves for more than 100 years. It still divides the U.S. along racial lines today.

People who think this was all solved by Martin Luther King and believe we now all live happily in one big multicultural family are sticking their heads in the sand. These forcibly united states are not one homogeneous culture. The melting pot has stopped working. The U.S. is perhaps now more deeply divided than ever, along several different cultural lines, race being a part of the mix. Yes, blacks and whites are getting along better now than they did 50 years ago. But that’s not a function of anti-discrimination laws and forced integration. It’s a function of technology and communication. I’m of the opinion that the U.S. would never have had the kind of serious race problems its had if Lincoln had simply let the South go its own way. Blacks in Canada or Brazil haven’t had the kind of problems we’ve seen in the U.S. The War Between the States created hatreds and distortions that lingered for generations.