Somehow by your classic cracker jack Democratic Party economic theory, dollars generated by exports are more valuable that dollars generated by internal work and production. Now, assuming that old Dixiecrat saw is true, you simply must explain how one dollar gained from the sale of cotton could buy more than one dollar gained elsewhere. I can't wait for this brilliance.
GNP consists of a nations entire productivity, not just the foreign currency it picks up by parting with it's agricultural products. The essential terminal problem for the south was that it's economy was fatally unbalanced. It could only produce agricultural products, and of those mainly only cotton. While this was first step, it could never manufacture anything out of it, and the real wealth in that day and age came from the manufactures made from the raw resource. Pick virtually anything made anywhere, and the cost of the raw material is almost always less than the labor and costs associated with manufacturing and distribution. Very often, it's but a mere fraction of the total value. The south defaulted on all of this enhanced value, and so remained a one ride pony with no prospects of a better future.
The US of that era was largely self-sufficient. Exports, while nice, represented only a minor piece of the larger GNP and wealth. By the time you average that total GNP over the popoulations involved in producing it, the South becomes a real loser, being substantially under national averages and norm in all aspects except for those statistics relating only to the top 2% of suthern society. When your classic Democratic historical views cites the Morrill Tariff as reducing imports, besides ignoring the monstrous costs of the war, it also ignores the fact that in the 1860's US industrialism first truly started to boom. This meant that overall, more quality products were available in the US from US manufactures, and therefore the percentage fall in tariff revenue you cite had two major causes, neither of which were the classic and irrational Democratic terror of protective tariffs.
Now, take your lame Democratic Party history of the US and put in in the trash where it belongs, along with the rag of treason and it's shameful mythology.
That is not necessarily the case in every export situation, though it is almost always the case in a comparatively advantaged free trade situation. If the domestic good costs $2 and the foreign substitute (i.e. an import, for which an export is effectively traded) costs $1, it is preferable to purchase the foreign substitute and with it gain an increase in the consumer surplus by way of that lower price. Thus a net gain will indeed occur from the trade economy over what would be the case if only the domestic economy existed. As for towing old Democrat lines, the only person doing that around here is you. Your attempts to excuse away the blatantly protectionist Morrill Act and your apallingly ignorant renditions of trade economics read like something straight out of an AFL-CIO talking points book with a DNC seal of approval affixed to its cover.
Now, assuming that old Dixiecrat saw is true, you simply must explain how one dollar gained from the sale of cotton could buy more than one dollar gained elsewhere.
Easy. Assuming free trade conditions exist, cotton will function as the export in the trade equation (for trade to happen something must go out and something else must come in. That means we take in imports and give out either our own exported goods or credit for later purchase of our goods). Since there are many products that can be produced more efficiently and at lower prices abroad than domestically, it stands to reason that some other countries will have an advantage in producing those products, be it comparative or absolute. Their prices will often be lower than the domestic producers of the same good. Since free trade exists, consumers may reap the benefits of the imported good and its lower price. They gain in their consumer surplus from that good's purchase over what would be the case if they had only domestics to choose from. Now, since cotton is the US's comparatively advantaged good it is an ideal means of trading for those cheaper priced imports. Therefore it becomes the country's main export. Granted, one could theoretically pass a law or something mandating that only the domestically produced more expensive items be used in trade, but that would be stupid since nobody else in the world would want those goods due to their higher prices. Therefore if we shifted our production to an inefficiently produced domestic good and attempted to offer only it on the world market trade would shrink to a trickle and the country would lose out on the benefits that cheaper priced imports give us. Without those cheaper imports we lose the gain in consumer surplus that they facilitated. And that is why having cotton as an advantaged export increased the nation's wealth more than simply producing inefficient and more expensive domestics (i.e. the second rate and overpriced crap that yankees made at that time).
GNP consists of a nations entire productivity, not just the foreign currency it picks up by parting with it's agricultural products.
It is not just foreign currency that we are concerned with. It is also foreign imports that are exchanged for exports.
The essential terminal problem for the south was that it's economy was fatally unbalanced.
Not really. Most sane economists will agree that specialization, particularly in the area of trade, is a good thing and increases the overall efficiency of the economy. That the south did not have manufactured good X, an arbitrarily deemed "good" thing that you have decided for whatever reason that all economies must have no matter how inefficient they are at producing it, does not mean it could not (a) obtain manufactured good X or (b) compare economically with countries that did produce manufactured good X.
It could only produce agricultural products, and of those mainly only cotton.
Agriculture was where the south had its comparitive advantage in the world. It would be stupid for a country with a comparative advantage in agriculture to expend its resources in some other area where it had no advantage - such as diamond mining - as that would lead to both economic inefficiency and a complete waste of the country's existing resources in pursuit of a non-existing one.
While this was first step, it could never manufacture anything out of it, and the real wealth in that day and age came from the manufactures made from the raw resource.
Evidently this was not the case for the north, which could not compete with Europe in most manufactured goods and thus demanded protection from their lower prices. After all, the United States in 1860 wasn't exactly known for shipping its high quality manufactured goods all over the world. It was known for doing that with cotton though - so much that the single crop of cotton made up two thirds of its total exports.
Pick virtually anything made anywhere, and the cost of the raw material is almost always less than the labor and costs associated with manufacturing and distribution.
Ever heard of value added stages of production? There typically is money of some form at every stage but not everybody is suited to do every one of those stages and in fact it is normally more efficient that they not do that. Some countries and regions, for example, are better endowed with labor than others. Some are better endowed with manufacturing ability than others. And some are better endowed with good crop land than others (unless, of course, you have figured out a way to grow a strong cotton crop in Minnesota). If you happen to be the country that is endowed with agricultural land but not a large labor population or not a strong manufacturing ability it would be STUPID to try and produce in either of those areas because doing so would inevitably require withdrawing some of your resources away from the thing that you are good at - agriculture. Thus the silly attempt at economic autarky will almost assuredly lead to a net loss for that given economy.
The south defaulted on all of this enhanced value
Not really. They simply realized - and quite correctly - that they were better at growing the stuff than processing it into manufactured goods. Europe by contrast couldn't even dream of growing the stuff but they could manufacture it with great efficiency. Thus trade between the two was well suited to both.
The US of that era was largely self-sufficient.
Not really. Their economy, like any modern economy, was intrinsically tied to international commerce. So strong was this the case that 1857's events surrounding the Crimean War - an incident in which America had virtually no direct involvement - were able to spark European financial recessions which in turn spread to America as the Panic of 1857. The so-called "self-sufficient" policy of economic autarky is a load of garbage straight from the AFL-CIO playbook.
Exports, while nice, represented only a minor piece of the larger GNP and wealth.
Before we proceed down this path may I ask where you get your GNP figures from? This is necessary to ascertain their historical validity, especially since economists generally recognize the widespread unreliability of major national economic figures prior to about 1870 and the partial unreliability of them prior to about 1900. Also may I ask why you make vague claims about the south's alleged position in these statistics, themselves universally considered to have a high unreliability, yet never bother to produce any hard data or figures? My strong speculation is that you lack the necessary data to substantiate your claims about the GNP just as you lacked the necessary data to substantiate your previous string of falsehoods about the Morrill tariff act.
When your classic Democratic historical views cites the Morrill Tariff as reducing imports, besides ignoring the monstrous costs of the war,
Imports into the north's largest port, NYC, halved practically overnight when the Morrill Act was adopted in March 1861. That is an indisputable historical fact taken straight out of the NYC customs house reports. The first shot of the war was not until a month later in April and war spending did not start in full until Congress reconvened in July. By then trade had already dwindled to a trickle. All that in other words the war's costs had little to do with what happened and the Morrill act had everything to do with it.
it also ignores the fact that in the 1860's US industrialism first truly started to boom. This meant that overall, more quality products were available in the US from US manufactures
Quod gratis asseritur, gratis negatur. If you don't understand it look it up.
and therefore the percentage fall in tariff revenue you cite had two major causes
No therefore at all. Your first "cause" contradicts the one factor that cannot be altered in any historical debate - the timeline itself. Your second "cause" is nothing but a wholly unsubstantiated and accordingly discardable claim that also happens to contradict the conventional wisdom of the manufacturers you claim were benefitting (if they had truly come of age in 1860 and suddenly became able to compete with Europe, why were all the northern manufacturers clamoring around for a protectionist tariff?).
Now, take your lame Democratic Party history
It is once again odd that you would attempt to characterize my statements as "Democratic Party history" considering that (a) my statements adamantly adhere to a free trade position, which is a conservative republican belief rather than a democrat one, and (b) your statements read like an excuse sheet for protectionism put out by the AFL-CIO, an organization that firmly aligns itself with the liberal democrat party of today. In light of these two occurrences I may safely and factually conclude that not only do your characterizations lack accuracy. They also indicate that you are projecting your own position's shortcomings onto the position of another.