When the Confederate States of America was formed in 1861, it was the fourth-wealthiest country in the world at that time. But its agrarian-based economy was not suited for the new type of war which it faced, and that would ultimately prove to be its undoing.
Despite its geographic size, the Confederacy was only sparsely populated. Compared to the North’s 23 million the South had only 9 million inhabitants—about 40% of which were enslaved. In military-age males, the North had 3.5 million; the Confederacy had only 1 million (of which over a third were slaves). The largest city in the South was New Orleans, with 160,000 people, but this was only the sixth-largest city in the US. The next-largest Confederate city was Charleston SC, with only 40,000 citizens (the 22nd-largest city in the US).
The American Civil War was in many ways the first “modern” war, in which large bodies of troops (both volunteer and conscripted) faced each other with a variety of new and deadly weapons that were churned out in vast quantities, making the “national economy” an important weapon of war. But in terms of the manufacturing industries which would play such a crucial role in the coming conflict, the Confederacy was far behind. The South had only 20,600 manufacturing plants, with around 200,000 factory workers (about 95% of which were slaves). The North, by contrast, had 100,500 factories which employed over 1.1 million workers. In total, the South was producing about $150 million worth of manufactured goods before the war: the North was turning out over $1.5 billion.
The new Confederate Government, recognizing the weakness of its industrial sector, convinced itself that it could remain financially viable through its strong export market. The Southern economy was almost entirely dependent on exports of tobacco, sugar, and, above all, cotton. The pre-war South accounted for 70% of the United States total exports, and cotton made up three-fourths of that. European nations like England and France were completely dependent upon Southern cotton to feed their vast textile industry, and the Confederate Government believed that this financial bond would force the European powers into intervening on the side of the secessionists.
In the end, things did not turn out that way. In the early stages of the war, the Federal blockades of Confederate ports cut off their exports by 90%, ending their foreign exchange and crippling the entire economy. Southern states were forced to quickly improvise their own manufacturing capacity, but they lacked the raw materials necessary for this.
The Confederacy did begin the war with a fairly good transportation network of railroads and rivers, but quickly lost both, as the Union Navy closed off the river ports and the railroads deteriorated from the South’s inability to manufacture new rails and equipment to replace damaged sections. Before the war ended, the destruction of the Southern transportation network meant that even food and agricultural products could not be delivered to cities where they were needed, and a wave of bread riots broke out across the Confederacy. The Confederate Government, wracked by inflation, was forced to pay for supplies with bonds redeemable at the end of the war—which were of course worthless. Much of the South was forced into a rudimentary bartering economy.
One of the most important economic assets that the Confederacy had was the Tredegar Iron Works, in Richmond. Founded on the banks of the James River Canal in 1836, Tredegar produced locomotive engines and railroad tracks, and by 1860 the plant covered five acres and employed 800 workers, both free and enslaved.
When the Civil War broke out, Tredegar was the largest foundry in the South, and the only one capable of large-scale production of weapons. When the newly-declared Confederate States of America moved its capitol from Montgomery AL to Richmond in May 1861, it did so partially to concentrate its military forces to protect the vital industrial plants there. Under the direction of the Confederate Government, the foundry at Tredegar began manufacturing cannons, rifled muskets, and ammunition. The plant manager, Joseph Anderson, became a Brigadier General in the Confederate Army, was wounded at the Battle of Glendale, and was placed in charge of the army’s Ordnance Department. For the rest of the war, the Tredegar works produced naval cannons, field guns, rifled muskets, carbines, artillery shells, boilers and iron armor for ships, and railroad rails.
Production did not stop until the day Richmond surrendered near the end of the war. However, as the war went on and materials became more and more scarce, the quality and quantity of the plant’s output suffered. At one stretch, the foundry did not produce a single cannon for over a month. Towards the end of the war, when a copper shortage meant there was no more bronze, Tredegar began casting its cannons from iron instead. Anderson also opened a wool mill next to the iron foundry, which produced Confederate Army uniforms until it was destroyed by a fire in 1863.
When Richmond was evacuated near the end of the war, the Confederate Government ordered Tredegar burned along with the other remaining industrial plants in the city, to prevent their use by the Federals, but Anderson paid 50 armed guards to protect the foundry from destruction, leaving it as the only operational iron works in the South when the war ended. Anderson received a pardon shortly later and re-opened the plant, and Tredegar, now just a remnant of its former importance, produced railroad spikes for the next few decades. As 20th century steel manufacture began to replace iron products, Tredegar faded into obscurity.
In 1957, Anderson’s heirs sold the site to the Ethyl Corporation, which undertook a restoration of some of the remaining buildings. For a short time in 1994 a museum was housed at the site, but it soon shut down. In 2000 the National Park Service and the American Civil War Center began joint management of the site as a satellite park, part of the Richmond National Battlefield. Today five of the original Tredegar buildings are preserved, containing exhibits of machinery and equipment as well as cannons, guns and other artifacts manufactured at the plant. They are listed as a National Historic Site.
Some photos from a visit.