250 



CONFEDERATE STATES. 



to North Carolina. As may be readily di- 

 vined, this loss of presence of mind threw the 

 people at large in the most frantic excess of 

 terror. There was nothing on all sides but 

 shouting and uproar, and confusion reached its 

 utmost height. The secret police of Gen. 

 "Winder had lost all control. The civil authori- 

 ties of Eichmond were anxious to do some- 

 tiling, but knew not what, and also lost their 

 senses. A small number of the Baltimore rab- 

 ble took advantage of the hubbub, and, in 

 public meeting, passed resolutions condemning 

 Eichmond to conflagration so soon as the Union 

 troops should enter it. Yet all who could escape 

 did so. The sick and the wounded were carried 

 farther into the interior ; many public and pri- 

 vate buildings were marked out for destruction ; 

 and, in short, a frightful catastrophe seemed to 

 be impending over the Southern capital." 



This contraction of the line of defence pro- 

 duced a greater concentration of forces and 

 a capacity for more powerful resistance. At 

 the same time the coast line of defence had 

 been abandoned, and with the loss of the har- 

 bors of North Carolina and Florida, Fort 

 Pnlaski and New Orleans, the forces were 

 withdrawn to interior lines. The first step 

 of the Government under this aspect of affairs 

 was to render Eichmond impregnable. The 

 next was to take such measures as would dis- 

 perse the powerful force threatening it on the 

 Chickahominy. The Federal Government was 

 led to believe by rumors thrown out for the 

 purpose, that the force of Gen. Jackson was 

 designed, after defeating Gen. Banks, to march 

 upon Washington or cross into Maryland, and 

 reinforcements were sent forward to confirm 

 the deception. It was successful. But Gen. 

 Jackson was immediately brought back to co- 

 operate in an attack on the flank and rear of 

 the Federal army on the Chickahominy at the 

 same time that it was assailed in front by Gen. 

 Lee. The plans were successful. The Federal 

 army was forced back upon the James river and 

 finally evacuated the peninsula. The condition 

 was now entirely changed. The Confederate 

 forces were triumphant, while their enemy was 

 everywhere reduced. It was determined to 

 make the latter "taste of the bitterness of 

 war." A Confederate campaign in Maryland 

 and Kentucky was resolved upon, ' to obtain 

 meat and bread and munitions of war." The 

 Confederate' States at this time were exhausted, 

 in consequence of supporting not only their 

 own population, but the armies of friend and 

 foe. It was thus argued : 



The great and true source of meat supply is the 

 State of Kentucky. If our armies could push directly 

 forward ou that State and occupy it to the banks of the 

 Ohio, the political advantages secured to the South 

 would be of no small account compared with those she 

 would derive in a sumptuary point of view. There 

 are more hogs and cattle in Kentucky available for 

 general consumption, two or three to one, than are 

 now left in all the South besides, and steps ought to 

 be taken by Government to drive these animals, as 

 well as mules and horses, as the armies march for- 

 ward, and place them within our lines. It is not only 



positively important to us that these animals should be 

 promptly secured as they fall within our grasp, but 

 it is negatively so also, in depriving the enemv of the 

 convenient supplies of meat for their army which they 

 have derived from Kentucky. In this point of view the 

 campaign in Kentucky becomes doubly important, and 

 assumes an interest as great as that in Maryland. 



The capture of the stores at Manassas Junc- 

 tion and Harper's Ferry, and the spoils taken 

 from Kentucky, were of immense service to the 

 cause. The results ot the campaign, however, 

 developed to the Government the first fact of 

 the war, which was that it could not carry on 

 an offensive war against the North. Its military 

 plans for the remainder of the year were con- 

 fined to annoying the enemy, to preserving Eich- 

 mond from danger, and to keeping up the block- 

 ade of the Mississippi by holding the strong 

 positions of Vicksbnrg and Port Hudson. (See 

 ARMY, CONFEDERATE, and ARMY OPERATIONS.) 



The civil organization of the Government 

 was as follows : 



Secretary of State J. P. Benjamin, of Louisiana. 



Secretary of War George W. Randolph, of Virginia. 



Secretary of the Navy S. R. Mallory, of Florida. 



Secretary of the Treasury C. G. Memminger, of S. C. 



Attorney General Thomas H. Watts. 



Postmaster General James H. Reagan, of Texas. 



In November the Secretary of War resigned, 

 and James A. Seddon, of Virginia, was appoint- 

 ed to his place. He was one of the commis- 

 sioners sent by the Virginia Legislature to the 

 Peace Conference at Washington in 1861, and 

 had been a Eepresentative to Congress from 

 1845 to 1847, and from 1849 to 1851. 



The finances of the Confederate States have 

 apparently not improved during the past year. 

 The only dependence has been upon issues of 

 paper money, which have followed their natu- 

 ral tendency to depreciation and ultimate worth- 

 lessness. It is probable that in the isolated 

 condition of the Confederacy, being cut off 

 from external intercourse, paper may float to 

 better advantage in the currents of internal 

 trade than where similar issues, as at the North, 

 are exposed by commercial transactions to con- 

 tinual contact with the specie currencies of the 

 countries with which commerce is conducted. 

 On the other hand, the Confederate system of 

 finance has lacked the support which, with a 

 powerful navy to keep its commerce open, it 

 might have had from the duties on imports and 

 upon the exports of cotton. Those two items 

 were made a dependence for certain loans early 

 in the war, but they have failed to realize the 

 expectations based upon them. The first loan 

 authorized, that of Feb. 28, 1861, was on a very 

 sound principle, had it been possible to export 

 cotton. The act provided for a loan of $15,000,- 

 000, bearing 8 per cent, interest, to be discharged 

 by a duty of about 55 cts. per bale of cotton ex- 

 ported. It was supposed that the productfor 1862 

 would be $2,200,000, which would pay the inter- 

 est $1,200,000, and $1,000,000 of the principal. 

 This operation, with an increasing crop of cot- 

 ton, would, it was estimated, discharge the debt 

 in 1870. The debt was contracted, but the duty 

 is not forthcoming. This money was soon ex- 



