How Did the Economy Change After the Civil War?
The economic impact after the Civil War was devastating for the South and the North, because the war was extremely costly for both sides. It took decades for both sides to recover.
During the Civil-War both sides printed paper currency in order to pay for the war effort. By the time the war had concluded, the value of the confederate note bottomed out, rendering it worthless. Thousands of people lost their entire life savings. The South also sustained extensive damages to many cities and towns. Being primarily agricultural, the South also had far less in its reserves at the outset of the war than the North.
According to FEE.org, the national debt more than doubled by the conclusion of the Civil War. Before the war began, the United States relied on tariffs for its revenue, but with the expense of the war and the subsequent pension claims placed by injured war veterans and widows of war veterans, the government established income taxes, estate taxes and excise taxes in an effort to pay down the massive war debt. By 1893, the 2.7 billion dollars of war debt had dramatically declined to 961 million in war debt. By the end of the century, two-thirds of the war debt was eliminated.
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