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This, combined with the specter that as soon as the primary cotton and tobacco producing states seceded with the subsequent massive loss in exportable products, that the US Treasury was in great jeopardy.

Just as Lincoln took office, the United States Congress voted a doubling of the tariff rates. This aggressive tax and protectionist policy had been advocated for decades by political groups seeking to protect their interests. Just as the new president was organizing his government, the Confederacy announced its tariff rates—one half the of the new Union rates.

With New Orleans already the gateway to the Midwest, and with Charleston having a newly dredged harbor, Lincoln and his supporters realized that direct trade with Europe would now be possible for Southern business interests. This would supplant the shipping, banking, insurance, and freight companies that flourished with the movement of Southern goods through northern ports into the overseas trade. Northern ports, supplying the mid west would also be damaged by the trade that would move back through New Orleans, Galveston, and Mobile.

After the tariff rates were announced, newspapers, politicians, businessmen, and industrialists called on Lincoln to take action to obviate the Southern competition. Since essentially the Southern states were forming their own cotton, rice, and tobacco world exchange, he had to halt it.

His options were not plentiful. He could not sabotage the Confederate market without initiating a blockade, and because that would be an all out unilateral act of war that no one in his cabinet would support. He could use the United States Army and Navy to materially force the Confederacy back into the Union, however he knew that the citizens of the country and world opinion would be against him. He could not risk his new administration by being an obvious aggressor to the new Confederacy.

He could not underwrite a change in government, or ‘coup d’etat’ since the Confederate government had just been formed with essentially the same Constitution as that to which he had just pledged to support. Again, he would be seen as the aggressor against a country with the same laws to which he and his party swore loyalty.

He did have the option of negotiating acceptable terms and limitations that would be acceptable to both parties. However, this would involve dismantling the tariff system, changing the taxation traditions of the government, and opening up American manufacturing to foreign competition. Also, since the less influential individual Southern states had now formed essentially a powerful trading block that could require cooperation that they could not achieve as members of the Union, the new government faced the fact that a new country had been founded and must be dealt with.

He could not depend on any European countries to aid the government in the institution of trading sanctions because they wanted a less powerful United States.

However, since his ‘house divided’ speech, Lincoln had demonstrated an unassailable inclination towards confrontation with the Southern leadership. He, therefore, chose a course of action that was coercive but not obviously aggressive, and enabled plausible deniability over the actions that eventually led to the outright war that most of the era expected.

Without notifying Congress, Lincoln sent a fleet of Union warships under command of a retired junior Naval officer under orders to send supplies to a group of Union soldiers that were about to surrender and leave a fort with no function other than to force taxation of the local people. Their resistance became labeled rebellion, despite the absence of any other higher authority from which to rebel, except a sitting U.S. president who had vowed to protect the revenue stream from Southern production.

The new President would accept slavery but not the loss of revenue for the country. He essentially treated the Southern Confederacy as subject states of which he demanded that they remain under the taxing authority of the government.

It is interesting that an earlier poster postulated that states that ignored the 'runaway slave' act were noble in their effort to resist the government. It can equally be said that the Confederacy, and particularly the people of Charleston were noble in their efforts to resist the Union naval invasion of Charleston Harbor and Lincoln's openly stated and absolute objective of protecting the revenue flow to the Treasury. These people were resisting the efforts of Lincoln to reduce them to minor nation-states to be taxed as the Europeans had done in Africa and in the far East.

This, combined with the specter that as soon as the primary cotton and tobacco producing states seceded with the subsequent massive loss in exportable products, that the US Treasury was in great jeopardy.

Another overstatement.

With New Orleans already the gateway to the Midwest, and with Charleston having a newly dredged harbor, Lincoln and his supporters realized that direct trade with Europe would now be possible for Southern business interests.

It had always been possible. In fact, according to figures printed in "Lifeline of the Confederacy: Confederate Blockade Running During the Civil War" Stephen Wise notes that well over 90% of all cotton exported from the U.S. left from Southern ports. And he also notes that this trade was one-sided, with the vast majority of exports leaving from Southern ports and the overwhelming majority of imports arriving at Northern ports. Why wouldn't this continue? The confederacy could ship its goods on U.S. ships just as easily after the separation as before.

After the tariff rates were announced, newspapers, politicians, businessmen, and industrialists called on Lincoln to take action to obviate the Southern competition. Since essentially the Southern states were forming their own cotton, rice, and tobacco world exchange, he had to halt it.

Competition in what? After the separation the U.S. would not be competing in producing cotton or tobacco. The confederacy, with zero merchant marine to begin with, would not be competing in that area. Finance, insurance, brokering, exporting, all had been contracted out to Yankees before the separation, why wouldn't the South continue that arraingement? There certainly wasn't any alternative available to them in the confederacy.

He did have the option of negotiating acceptable terms and limitations that would be acceptable to both parties.

That was not an option. Lincoln was offered the change to recognize the legitimacy of the Southern acts of secession and accept confederate sovereignty, period. No negotiations on that point were offered by the confederacy. Repeating this canard of your's again and again doesn't make it true.

However, this would involve dismantling the tariff system, changing the taxation traditions of the government, and opening up American manufacturing to foreign competition.

Why? What impact would confederate independence have on U.S. tariffs?

He could not depend on any European countries to aid the government in the institution of trading sanctions because they wanted a less powerful United States.

If that was true then why didn't the European powers jump at the chance and recognize the confederacy on day 1? Wouldn't that weaken the U.S. right away, if that was their goal?

However, since his ‘house divided’ speech, Lincoln had demonstrated an unassailable inclination towards confrontation with the Southern leadership.

Complete nonsense. The person who wrote this obviously never read the speech.

He, therefore, chose a course of action that was coercive but not obviously aggressive, and enabled plausible deniability over the actions that eventually led to the outright war that most of the era expected.

He chose the course which allowed Davis to decide if it was to be war or the status quo. Davis chose war.

Without notifying Congress...

Why did he have to notify Congress?

...and leave a fort with no function other than to force taxation of the local people.

That's past nonsense and approaching bullshit territory. As does the rest of it.

Kudos to you sir. The Panic of 1857 affected the NORTHERN states, but lightly affected Southern states, due to the demand for Southern exports. Losses in the North and West were estimated at 142 MILLION (back when a million was an immense sum), while Southern losses were only 17 million. The world was not beating down the doors to import Northern manufactures, especially when they could purchase superior products from Great Britain. But the world needed Southern products badly, with cotton exports single-handedly rescuing the economy.

In 1857 bitterness arose between the sections increased, as millions of Southerners - including slaves - remained prosperous and well-fed, but in the North some 200,000 had lost their jobs, and "Bread" riots occurred in the North, not the South. Parson Brownlow of Tennessee stated that Northen industrialists should refrain from attacking slavery, and instead find means to feed the starving Northern poor.

The net result of the Panic of 1857 [the worst up to that point in time] was a massive shift in fortunes, as money vanished from Northern pockets and found it's way South.

Anyone wanting to understand the economic motivations of Lincoln and the North should study the Panic of 1857 and it's aftermath, and understand the increased bitterness and hatred of Southerners and slavery.

Their resistance became labeled rebellion ...

Of course it must, otherwise the secessionists were morally and legally correct, and Lincoln and his cadre were the despots and dictators.

Again, during the convention, one James Madison, motioned for the power of the militia to PREVENT SECESSION, and force the secessionists to rejoin the union. Giving credit where it is due, the framers REJECTED his insane motion overwhelmingly.

Those framers knew that they had seceded from Great Britain, and were about to secede from the Articles of Confederation and ~~Perpetual~~ Union.