Wednesday, May 8, 2013

Financial Panic and Copperhead Uprising

Not surprising was the resistance of the Northern war munitions industry to peace initiatives; after defeat in 1856 the new Republican party saw future victory in wooing northeastern industrialists through protective tariffs and corporate welfare schemes, and protecting their interests at the expense of the agricultural South.  In early 1864, Southern agents in Canada like Captain Thomas Hines rounded up Southern prisoners of war who escaped across the border to freedom, holding the most useful for his clandestine command and helping others return South via blockade runners to Wilmington.  From June 1864 on, Hines and the Confederate Commissioners planned bold moves to bring their enemy to the peace table.

Bernhard Thuersam, Chairman

North Carolina War Between the States Sesquicentennial Commission

"The Official Website of the North Carolina WBTS Sesquicentennial"

Financial Panic and Copperhead Uprising:

"While Hines rounded up the escaped prisoners of war to form his tiny "squadron," as he would call it in later years, [Confederate Commissioner in Canada Jacob] Thompson set out for Niagara Falls to contact "potent men of the North" to learn how they felt about peace. Leading Copperheads like Fernando Wood, ex-mayor of New York City, and ex-governor Washington Hunt of New York, met with him at the Clifton House [hotel in Niagara Falls, Canada West]. New York and the East were not ready for peace or an uprising, they told Thompson. War [munitions] manufacturers there were too powerful and were on the alert to "neutralize" any peace efforts.

Thompson next turned to Secretary [Judah] Benjamin's favorite project: trying to create a financial panic in the North by buying up gold and smuggling it out of the country in order to weaken the gold security for the Union dollar. A Nashville banker named Porterfield, who was living in exile in Montreal, was selected by Thompson as the proper man to set this in motion.

Porterfield was furnished with fifty thousand dollars. He went to New York, opened an office under a fictitious name and began to purchase gold, which he exported to England and sold for sterling bills of exchange. Then he converted the sterling bills into dollars which he used to buy more gold. The transaction was a costly one, showing a loss due to the cost of operations, trans-shipment, etc.  Porterfield continued until his losses were twenty thousand dollars….[but by] this time he had exported five million dollars in gold, "and had induced many others to ship much more [gold]." His buying up gold and sending it out of the country began "showing a marked effect," as Thompson said in his official report to Richmond, when the Federals cracked down.

A former partner of Porterfield's was arrested by General Ben Butler for exporting gold, and thrown into Lafayette Prison in New York Harbor. Porterfield fled back to Canada….[but] still retained the twenty-five thousand dollars remaining to continue the exporting of gold through "fronts" in New York.

By the first week of June, 1864, Hines was in touch with his Copperhead friends in Ohio, Indiana and Illinois and in communication with [Ohio gubernatorial candidate Clement] Vallandigham, who was now [exiled] in Windsor [Canada West].  A meeting was set for the 14th to plan the Copperhead uprising and the release of the Rebel prisoners in Camps Douglas, Morton, Chase and Rock Island.

Hines and Thompson met with Vallandigham on the 14th….[at] St. Catherines, Canada [West]…[and the latter] detailed for Hines the strength of the Copperheads. Membership totaled about 300,000. Illinois had furnished 80,000, Indiana, 50,000, Ohio, 40,000 and Kentucky and New York States, the rest.  A "feeling of fatigue" was sweeping through the North, Vallandigham told them, following Lincoln's call for 500,000 more men….[and] he added: "If provocation and opportunity arise, gentlemen, there will be a general uprising."

(Confederate Agent, A Discovery in History, James D. Horan, Crown Publishers, 1954, pp. 88-90)