Streetwise Professor

November 30, 2014

The Battle of Franklin: Sublimely Valiant Sacrifice in the Service of a Bad Cause

Filed under: Civil War,History,Military — The Professor @ 4:11 pm

Today is the 150th anniversary of the Battle of Franklin, one of the most brutal and intense combats of the entire Civil War.

The battle was the pivot of Hood’s Nashville Campaign.  November, 1864 saw the bizarre phenomenon of the two major armies in the Western Theater, Sherman’s Armies of the Tennessee and Georgia, and Hood’s Army of Tennessee, marching in opposite directions. Sherman embarked south on his March to the Sea, and John Bell Hood launched a desperate lunge north, hoping to reach the Ohio River and accomplish . . . something. Just what he could have accomplished is a mystery, as the logistical obstacles alone made the campaign a forlorn hope.

That said, Hoods campaign started well. He deftly outmaneuvered John Schofield, commander of the largest force that Sherman left behind to hold northern Georgia and Tennessee. Schofield’s force consisted primarily of his XXIIIrd Corps (grandiloquently referred to as the Army of the Ohio) and the IVth Corps (of the Army of the Cumberland). Schofield retreated to Columbia, TN, on the Duck River and dug in. Department Commander George Thomas ordered Schofield to retreat to Franklin on the Harpeth River, but before he could do so, Hood stole a march and outflanked him. Schofield had to retreat precipitously from Columbia, but Hood was in position to cut him off near Spring Hill.

In events still shrouded in mystery, the Confederates did not close the trap at Spring Hill. Two rebel divisions remained in place within sight of the Columbia Pike, along which Schofield’s men were marching for their lives. Some Unionists unwittingly wandered into the Confederate lines to light their pipes in the burning fires. While the Confederates waited, Schofield slipped by and made it to Franklin.

The bridge over the Harpeth being destroyed and needing repair, Schofield had his men dig a semicircular line of entrenchments with its flanks anchored on the Harpeth. Due to a confusion in orders, one division (Wagner’s) remained a half-mile in front of the Federal main line. Well, two brigades did, anyways. The third, under irascible Emerson Opdycke, who thought the order idiotic, continued to march into the Federal lines, collapsing exhausted near the Carter House a few hundred yards fro the trenches.

Hood awoke  to find that Schofield had escaped. He excoriated some of his corps and division commanders, including Frank Cheatham and Patrick Cleburne, arguably the most able soldier in his army, for their failure to destroy the fleeing Federals. He urged his troops forward in pursuit.

There is some controversy about his mental state. Some, notably Wiley Sword (whom I know slightly) claim that Hood was enraged, and intent on punishing his army for its failure to attack with vigor at Spring Hill. Others, including Eric Jacobsen and Hood biographer Stephen Hood (a distant relative of the general) vigorously dispute this. Regardless, Hood’s subordinates, including the often inebriated  Cheatham, expressed unease at attacking a dug in Schofield, but Hood dismissed their objections, claiming that he would have to fight them somewhere, and it was better to do so in Franklin before they were able to retreat to the formidable fortifications in Nashville, to which Federal reinforcements were rushing from the west and north. He believed that these were the best odds he could hope to face, as bad as they were.

The assault was over two miles of open ground. It would have been blasted to oblivion well before it closed with the Federals, but for those two Union brigades sitting alone, 1000 yards in front of the main works. Cleburne’s division overlapped and overwhelmed Wagner’s isolated troops, who broke and ran. Up went a cry from the Confederates: “Follow them into the works!” With Wagner’s Yankees and Cleburne’s Rebels all mixed together, the Federals in the trenches held their fire and Cleburne’s men were able to surge over the earthworks between a cotton gin and the Carter House.

Enter Opdycke. The cantankerous Ohioan led his veteran brigade of Ohio and Illinois regiments in a wild countercharge that slammed bodily into the panting Confederates in the grounds around the Carter House. A swirling melee ensued. Opdycke emptied his pistol, then used the butt as a hammer to bash a Confederate over the head. In brutal hand-to-hand fighting, Opkycke’s men pushed back the Confederates, but only to the ditch at in front of the Federal lines. There ensued a battle reminiscent of the struggle at the Bloody Angle at Spottsylvania. Men at the rear would load muskets and pass them forward to soldiers who would thrust them over the top of the trench and fire them at point blank range into their enemies’ faces. When one would fall, his body would be pulled back and some other hardy soul would shoulder forward to take his place. Muskets with bayonets attached were hurled over the earthworks like javelins.

The primal combat extended into the night. The muzzle discharges flashed in the dark until the firing petered out, due to the mutual exhaustion of the adversaries.

While the face-to-face killing went on between the Cotton Gin and the Carter House in the center of the Union lines, the Confederates mounted large assaults on either flank. These attacks were shot down by the well protected Federal veterans, secure behind their stout earthworks.

The Harpeth bridge being repaired, Schofield’s men faded away from their works under the cover of darkness and the exhaustion of their adversaries, and wearily made their way north to Nashville.

The battered and spent Confederates awoke to visions of a holocaust. Dead men were heaped in the ditch in front of the Federal earthworks. Windrows of dead lay in fields over which the Confederates had charged.

But the dead were mainly on one side of the works: the Confederate side. Southern casualties were appalling, totaling about 1750 dead and nearly 4000 with disabling wounds. These represented about 40 percent of the attacking force. The size of the attacking force was larger than the Pickett-Pettigrew charge at Gettysburg, and the total casualties were larger as well.

Among the Confederate dead were six generals: Cleburne, Adams, Granbury, Gist, Strahl, and Carter.

Union losses were trivial by comparison, with less than 200 dead and about 1000 wounded, with a disproportionate share of those losses suffered by Wagner’s hapless troops. The Federals behind the earthworks suffered hardly at all.

The Army of the Tennessee dragged itself to Nashville, which it was utterly incapable of assaulting given its shrunken numbers and the city’s formidable defenses. Hood’s men dug a miserable line south of Thomas’s and sat, unable to go forward and unwilling to go back. Federal reinforcements flowed into the city, and after a two week pause (which drove Grant crazy), Thomas attacked and hammered Hood’s hopeless men in a two day battle that destroyed the Army of Tennessee as a fighting force.

But the fate of Hood’s army had been sealed  in the fields south of Franklin. The Confederate assault was insanely brave, all the more so because as veterans the men knew the fate that likely awaited them. It was a valiant sacrifice, but it was also a tragic waste made in the name of a bad cause.

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September 29, 2014

There’s Nothing New Under the Sun, Tumblehome Hull Edition

Filed under: Civil War,History,Military — The Professor @ 6:32 am

The US Navy’s most advanced destroyer, the USS Elmo Zumwalt, will begin sea trials next month:

The ship is plainly visible from Front Street, across the Route 1 bridge in downtown Bath. Nothing like this angular, almost hulking giant has ever been seen here, even after well over a century of shipbuilding at Bath Iron Works.

Here’s a picture of the EZ:

uss_zumwalt

But I wouldn’t be so hasty as to say that the ship’s shape is unprecedented. Here’s an image of the CSS Stonewall, a ram built for the Confederacy in France (and which almost caused a major diplomatic incident between the US and Napoleon III’s France):
css_stonewall_anacostia

The Stonewall had the same basic “tumblehome” hull design as the Zumwalt does today: Who knew the French were building stealth ships in the 1860s?

A Yankee ironclad, the USS Dunderberg, also had a bit of a Zumwalt look about her:

uss_dunderberg_plan_600

The Dunderberg’s superstructure is more Zumwalt-like than the Stonewall’s.

Of course the purposes of the hull designs were different in the 1860s and the 2010s. The Stonewall and the Dunderberg (I can’t get over that name, by the way) were built as rams, hence their sharply angled prows. But it is interesting to see the echoes and rhymes in designs a century and a half apart.

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July 27, 2014

Ezra Church, 150 Years Later

Filed under: Civil War,History,Military — The Professor @ 8:36 pm

Tomorrow is the 150th anniversary of the Battle of Ezra Church, the third of Hood’s assaults against Sherman’s army that attempted to stop the encirclement of Atlanta.

The story of the battle is relatively simple. After cutting the rail line leading into the city from the east, Sherman moved in what has been characterized as one of his whip-like movements to cut the line running in from Macon to the west. As always, the Army of the Tennessee was the tip of the whip. As it moved south to the west of the city, Hood moved Stephen D. Lee’s and Alexander P. Stewart’s corps out of the city’s defenses in the hopes of surprising the Army of the Tennessee (now under the command of very Eastern general Oliver O. Howard, much to the chagrin of very Western general John A. Logan). But the Union troops anticipated the attack, deployed from their marching formation and formed a V-shaped line. Like veterans on all fronts by the summer of 1864, they immediately started to dig in. Not so much dig, really as collect logs, lumber, and even the pews from Ezra Church, which they piled up to form a makeshift breastwork. Here are some contemporary woodcuts that show the impromptu entrenchments:

 

Ezra_Church_1

Toshiba Digital Camera

The battle itself was never really in doubt. The Confederates gained ground on the Union right flank, but Logan (back in command of the XVth Corps) led a counterattack by two regiments (the 40th Illinois and 6th Iowa) which drove off the Rebels. The Iowans lost Major Ennis, a beloved officer who had served since Shiloh.

The 46th Ohio fought at Ezra Church. One of its members, Sergeant Harry Davis, won the Medal of Honor by advancing in front of the lines to wrest a flag from its dying bearer, as illustrated here in another contemporary print:

Ezra_Church_46ovvi

Other than the fleeting success on the Union right, the Confederate assaults made no progress. The casualties tell the tale. The Union lost about 650 men, the Confederates almost 5 times as many. Of the three assaults in July, this was the one with most disparate losses and the least tactical success. Whereas the Confederates did achieve some local successes at Peachtree Creek and Atlanta. They achieved none at Ezra Church.

The responsibility for actually carrying out the attack lies with Stephen D. Lee. Hood was performing the role of army commander, remaining at his headquarters in Atlanta.

Speaking of Hood, my Battle of Atlanta post generated several thoughtful comments about him. Serendipitously, this weekend I saw a program on CSPAN3 (yes, I am that much of a geek about this stuff) in which a biographer of Hood, Stephen Hood (a distant relation) made a pretty persuasive case that Hood has been unfairly maligned. He presented evidence that many of the anecdotes told at Hood’s expense were specious. He was particularly critical of historian Wiley Sword (whom I know some) for distorting the evidence in his savage attacks on Hood’s generalship, his humanity, and indeed his mental health. He further claims that there is no evidence that Hood actually used opiates, though of course absence of evidence is not definitive evidence of absence.

Overall, his defense was somewhat persuasive, though it cannot and did not answer the brutal facts of Franklin and Nashville. When time permits, I might dig into the sources cited by Hood and Sword to see who gets the better of the argument. Maybe I’ll have a chance to do that by the end of November, when the sesquicentennial of Franklin rolls around.

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July 22, 2014

The Sesquicentennial of the Most Compelling-and Perhaps Most Important-Battle of the Civil War

Filed under: Civil War,History,Military,Politics — The Professor @ 8:14 pm

Today is the 150th anniversary of what I consider to be the most compelling battle of the Civil War: the Battle of Atlanta.

I find it compelling because it was a true soldier’s battle that demonstrated the unmatched martial virtues of the combatants, especially those in the Union Army of the Tennessee.

It was a soldiers battle because it was not fought according to any plan. There was a plan, and a rather impressive one on paper, but one that did not even make it to the point of first contact with the enemy. Instead, Confederate General John Bell Hood’s plan dissolved before a shot was fired due to the confusion of a night march, the fatigue of soldiers who had been engaged in combat for virtually every day of the previous two-and-a-half months, and wooded terrain crossed by watercourses and millponds.

Hood desired to reprise Jackson’s flank attack at Chancellorsville, a mere 14.5 months prior. But whereas Jackson attacked in depth, with three divisions one behind the other, Hood’s four attacking divisions were were strung out in a long, scraggly line scattered across several miles of Georgia scrub pine forest. Due to the trials of the march, the forbidding terrain, and the need to make haste, Hood’s divisions (commanded by Bate, Walker, Cleburne, and Maney) attacked mainly as brigades operating on their own hook, only tenuously connected with each other, if connected at all.

That said, they caught McPherson’s Army of the Tennessee in a very vulnerable spot. They were assailed from the direct flank (like Jackson had done to O.O. Howard’s hapless XIth Corps at Chancellorsville) and from the rear and front. Most Civil War armies would have fled when hit in force from flank and rear. But in one of the most sublime displays of soldiership in any war, Grant’s old army did not panic. Indeed, with little direction from any officer above brigade or division level, its soldiers reacted to the situation with aplomb. When attacked from the rear, they faced to the rear and beat off the attack. When attacked from the flank, they refused their lines and repelled it.

Some units, particularly those in the XVIIth Corps, were attacked sequentially from the flank, rear, and front. Resolutely, they responded to each threat. When attacked from the rear, they jumped to the front of their earthworks and beat off the assault, sometimes hand-to-hand. In one of the fights, Colonel Belknap of the 15th Iowa reached over the ramparts to grab Colonel Lampley of the 45th Alabama, wrestled him over the earthworks, and made him prisoner. Lampley had been screaming at his men for not following him. Belknap berated him: “Look at your men! They are all dead! What are you cursing them for?” (To demonstrate that martial prowess does not imply moral virtue, Belknap went on to become a corrupt Secretary of War under Grant. He resigned before being impeached for peculation in the matter of Indian trading posts.)

After being attacked in the rear, when attacked from their (previous) front (i.e., from the direction of Atlanta), the XVII Corps men cooly jumped to the proper side of their works, and easily drove off the attack.

When the Confederates assaulted from the flank, they withdrew stubbornly, fighting first from one side of the trenches, then the other, until they eventually formed on Bald Hill.

There the climax of the battle occurred. In ferocious assaults that continued into the dusk and then into the dark, the Rebels tried time and again to drive the Federals from their redoubt and trenches on the hill. But every time, the Illinoisans, Ohioans, Iowans, and Wisconsin men drove them back.

I am not aware of better fighting on any battlefield of the Civil War, or indeed of any other conflict.

Although the conflict around Bald Hill (sadly leveled by the construction of I-20 in the ’50s) is the most stirring part of the battle, the conflict is better known for the action around the Troup Hurt House. The Union counterattack that drove the Confederates from their lodgment in the Federal lines near that mansion is memorialized in the Cyclorama which is still on display in Walker Park in Atlanta. This was indeed an inspiring action that again demonstrated the sterling qualities of the soldiers in each army, but in my view pales in comparison with what occurred to the south on Bald Hill.

Throughout the battle, Confederates attacked ferociously, and the Union troops responded bravely and cooly, even when caught in the most exposed and dangerous positions. I defy anyone to identify a battle in which such a large number of troops (on the order of 30,000) responded as marvelously as did the troops of the XVth, XVIth, and XVIIth Corps of the Army of the Tennessee.

For the most part, they did this on their own initiative, and the initiative of company, regimental, brigade, and sometimes division officers. Their army commander, John B. McPherson, was shot dead early in the engagement. His replacement, John “Black Jack” Logan, provided inspirational leadership, but his tactical role was modest at best. The XVIIth Corps commander, Frank Blair, was far to the rear (which led many to question his courage).

Soldiers fought. Soldiers extemporized. Soldiers won.

Such individual initiative has been the hallmark of American soldiers since 1775. The Army of the Tennessee boys were recalcitrant soldiers in the traditional sense, resentful of discipline, and disdainful of spit and polish. But could they fight! They never lost a battle.

The Army of Northern Virginia is usually considered the exemplar of American armies in the Civil War, and it was indeed a marvel. But man for man, officer for officer, it could not compare to the Army of the Tennessee, especially at its July, 1864 apogee.

I have a personal connection to that Army. My great-grandmother’s brother, John Hatfield, fought in the 46th Ohio Veteran Volunteer Infantry. This unit was in Walcutt’s brigade of the 4th Division (Harrow’s) of the XVth Corps (formerly commanded by Sherman, then by Logan). It performed the signal service of defending the Union flank and rear against the attack of Smith’s Texas Brigade of Cleburne’s division. (John’s brother, Eli, had his arm shattered at the shoulder by a Minie ball at the Battle of Dallas on 28 May, 1864. My great-grandmother, who died when I was 4, talked of “Uncle Eli with the dead arm.” Medical records in the archives reveal that Eli was shot too close to the shoulder to permit amputation, so the surgeon removed all the shattered bone in his arm from the shoulder to the elbow. Ever after, the arm hung limp at his side.)

It is particularly inspiring to me at times like to consider the heroism of men like John and Eli Hatfield; their fellows in Sherman’s army; and even their foes in Hood’s Army of Tennessee. Some redeeming things came out of the carnage of the red clay hills of Georgia 150 summers ago, and these things were not sullied by craven politicians: indeed, it redeemed many of the errors and sins of the political class of 1860s America. That battle sealed the fate of Atlanta (though 6 weeks of grueling combat were to come before the city fell), which in turn sealed the fate of the Confederacy, for the fall of Atlanta secured Lincoln’s re-election, and thus the ultimate victory of the Union. And of course, that victory extinguished slavery in the United States. To have participated in such a thing is a credit to any man.

Would that today, we living Americans could be worthy of those who bled and died on a scorching day in the red clay of central Georgia, 150 years ago.

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September 20, 2013

Remember Chickamauga!

Filed under: Civil War,History,Military — The Professor @ 4:17 pm

Today is the sesquicentennial of the second day of the Battle of Chickamauga.  This was the most brutal, sanguinary Civil War battle west of the Appalachians, and the second bloodiest of the entire war.  It was also a swirling, confusing affair, a meeting engagement between two armies on the move that metastasized as units arrived on the battlefield.  The Union army was marching hard to get back to Chattanooga; the Confederates were trying to interpose themselves between the Federals and their base.   The conflict started towards the north, and then moved progressively south with charge and countercharge, as new units marched onto the field.  The confusion was compounded by the fact that most of the battle was fought in dense woods broken only by scattered clearings.  Regimental officers could not see their entire battle lines because of the timber and battle smoke that hung thick in the woods.  There were numerous successful flank attacks at the brigade and division levels because units became separated in the woods, leaving open flanks; attackers pounced on these exposed flanks undetected because of the thick foliage.

Bumbling generalship and command strife also contributed to the confused nature of the fighting.  The most egregious blunder was of course Union commander Rosecrans’ order to move Thomas J. Wood’s division out of line based on a misapprehension: Rosecrans’ aide could not see Brannan’s division in the heavy timber, and thought there was a gap in the line between Wood’s division and Reynolds’s.  Acting on this report, Rosecrans thought he was closing a gap when he ordered Wood to “close up” on Reynolds, but he was really opening one: Wood had to move out of line to get around Brannan in order to reach Reynolds.  Through this opening James Longstreet’s corps poured through, routing the entire Union right and center.  (It is quite possible that Longstreet’s attack would have been nearly as successful even if Wood stayed in line.  The Union divisions in front of his corps were small, and had taken heavy casualties the day before, and Longstreet attacked in mass and had great superiority of numbers at the point of attack.  For instance, Longstreet’s left smashed right through Davis’s division in minutes, and would have done so even if Wood had been in line: it is quite possible that Wood’s two small brigades would have been similarly overwhelmed had they not moved.)  That tactical error was just the culmination of a series of Rosecrans’s mistakes.  His scattered and hasty advance south of the Tennessee River based on a belief that the Confederates were in disorganized retreat from Chattanooga made him vulnerable to defeat in detail by the massing Confederates.  He was racing back to Chattanooga to escape the trap he had so injudiciously thrown his army into.

But Rosecrans was not the only blunderer.  Confederate commander Bragg frittered away the golden opportunity of trapping Rosecrans, due in part to his inept planning, and in part to the fact that his subordinates so heartily disliked him that they did not execute his orders efficiently.  Neither commander exerted any real control on the 19th, the day of the meeting engagement, but when the lines stabilized on the 20th, Bragg’s attack on the Union left was woefully executed at huge loss, again largely due to Bragg’s inability to get recalcitrant corps commanders to implement his plan, and the incompetence of those corps commanders (notably Polk).

As a result, this was not a battle of generalship (except in the negative sense).  It was a soldier’s battle.  On the first day in particular, moreover, it was not really a single battle, but a series of disjointed actions fought at close range between regiments, brigades, and divisions.

The Chickamauga battlefield was one of the first preserved by the Federal government, and is almost entirely intact.  Moreover, due to its early preservation, veterans of the battle erected numerous monuments marking where they fought.  The War Department (which managed the Park at the time of its creation and for some years afterwards) also erected numerous plaques describing the movements of each brigade involved in the battle.  Most of the markers are accurate.  One exception is around Snodgrass Hill and Horseshoe Ridge.  Gracie’s The Truth About Chickamauga does a good job at explaining how that part of the battlefield was mismarked, and why.  (In a nutshell: the process of placing markers and writing the descriptions was dominated by a figure, Henry Boynton, who wanted to exaggerate the role played by the brigade to which he belonged.)

I’ve walked pretty much every foot of the battlefield, on multiple occasions.  You really have to do that if you want to understand the action, and appreciate the conditions.  Two pieces of advice if you want to do the same, especially in the summer. 1. Check for ticks (especially if you’re blonde!). 2. Watch for snakes. Both are abundant in those Georgia woods.  Then there was that time I almost stepped on a wild turkey, which flew up right into my face.  I don’t know who was more surprised or freaked out, me or the turkey.  (Don’t go there!)

My grandfather first took me to the battlefield when I was 9, as part of an epic Civil War trip that was the genesis of my interest in the War.  We started at Shiloh, then Vicksburg, then Corinth, then Chickamauga-Chattanooga, then Fredericksburg, Chancellorsville, Wilderness, Richmond, and Antietam, before completing the journey in Gettysburg.  Now that’s a helluva trip, and my grandfather was an excellent storyteller who helped bring the battles to life. I have the vivid memory of him illustrating the Wood-close-up-on-Reynolds story using Tiparillo boxes on the kitchen table.

My great-great grandfather George Immel fought in the battle, as a member of the 92nd Ohio Volunteer Infantry.  Ironically, given the blogging proclivities of his descendant, he was an orderly to his brigade commander, Brigadier General Ivan Basil Turchin, nee Turchaninov (Ива́н Васи́льевич Турчани́нов), a Russian emigre.  Turchin was quite a character, as was his formidable wife, who intervened personally with Lincoln to save Turchin’s career after he had been relieved from command for sacking the town of Athens, Alabama in retaliation for guerrilla attacks on his brigade.  He went all Russian, in other words.

There is one story of the battle that  was passed down through the family.  George said that the most remarkable thing about the battle was the continuous noise, from all directions.  The roar was unceasing on Saturday the 19th until night fell (though there was also a night attack by Cleburne’s division that evening).  Then it began again the next morning, and didn’t stop until late in the day.

Turchin’s brigade played a rather prominent role in the battle.  It helped stop the attack of Cheatham’s division near Brock Field on the 19th, then later in the day led a counterattack that flanked elements of Bates’s and Law’s brigade that had penetrated the Union center around the Brotherton House.  On the 20th, it was in Thomas’s main line on the Union left, and behind some log barricades repulsed the attacks of Cleburne’s division.  (It was a part of Reynolds’ division, which Wood was supposed to close up on.)  During the final Union retreat, the brigade executed a bayonet charge through the McDonald Field, driving off the Confederates who threatened to cut off the escape route to Chattanooga.

That is the story of just one brigade, but overall the battle was fought largely at the brigade level.  On the Union side, divisions from the three main corps (XIV, XX, and XXI) were jumbled together, and only the commander of the XIV corps (George Thomas) really exercised any control over his entire unit: the other corps commanders (McCook and Crittenden) were rendered almost supernumerary, and Thomas ended up commanding large portions of their units.  Moreover, the terrain made controlling larger units almost impossible, so much of the battle devolved into brutal firefights between brigades.

Although it is a fascinating battle to study, with many stories of great personal bravery, ultimately all it produced was a monstrous casualty list.  It was almost utterly devoid of strategic impact.  Rosecrans’ Army of the Cumberland escaped by a hair’s breadth back to Chattanooga, and Bragg’s Army of Tennessee did not pursue (to the fury of Nathan Bedford Forrest).  A desultory siege followed, but Lincoln rushed reinforcements from the Army of the Potomac and the Army of the Tennessee while Bragg’s Army declined in numbers when Longstreet, disgusted by Bragg’s leadership, took off to attack Knoxville.  Under the command of Grant, the reinforced Federal forces drove Bragg from the heights overlooking Chattanooga.  (The 92nd Ohio participated in the decisive charge on Missionary Ridge.)

During this attack, the Union soldiers who had been defeated 150 years ago today shouted “Remember Chickamauga!” as their battle cry.  I remember it, and you should too.

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September 18, 2013

There is Nothing New Under the Sun, Warehouse Games Edition

Filed under: Civil War,Commodities,Economics,Exchanges,History,Politics,Regulation — The Professor @ 7:12 pm

I am working on a project about the economics of commodity trading firms.  One of the interesting questions is what physical assets commodity trading firms own.  In my research on this question, in an attempt to get some historical context, I turned to the excellent Federal Trade Commission Report on the Grain Trade, a five volume study released in the early-20s.  (There is reputedly a sixth volume on manipulation which I and others-Jerry Markham, for one-have feverishly searched for without luck.)   This is truly an excellent piece of work.  Many of the analyses are off, but as a detailed portrait of the grain trade in the 1900-1920 period, it cannot be beat.  Unfortunately, there is nothing comparable for other time periods.

In perusing Volume I, on country grain marketing, I came across this choice quote from the president of the CBOT in 1887:

The alliance between railroads and elevators has resulted in reaching out after millions of bushels not naturally tributary [to Chicago] and when gathered here preventing it by such tricks of the trade as you are familiar with from ever getting away again as long as storage can be collected on it.

. . . .

The grain bought elsewhere by warehouse proprietors is promptly sold to you here on future delivery, which, however, you can only get on payment of such premiums as the urgency of demand may enable them to exact.

. . . .

While the elevator proprietors are willing to pay 1 cent per bushel more for grain to “go into store” in their own warehouses than the market price of the same grain in store . . . is conclusive that the first storage charge is not legitimate, and also that the subsequent terms of storage are unduly profitable.

Replace “grain” with “aluminum”, and you could run this as a news story in 2013.  Goldman’s operations at Metro are almost identical to the operations of the warehousemen in Chicago that President Wright fulminated about 126 years ago.

The FTC study also notes that shuttling grain between warehouses was a part of the game more than a century ago.  It quotes Taylor’s magesterial history of the CBOT, describing an event from 1896:

The Armour Elevator Co. was charged with having transferred 1,200,000 bushels of wheat from one part of the north side system to another, without inspection, on such dates that the receipts resulting therefrom were just regular on the delivery day, May 1.

And not a bankster in sight.  (It is an interesting coincidence that 1896 was the year Goldman-Sachs was invited to join the NYSE.)

The morals of the story.  First, the ability to play warehouse games is inherent to the business of public warehousing of commodities. Second, banks are not uniquely susceptible to playing those games: when conditions are right, whoever owns the warehouses can play the games.  Third, systems of self-regulation are often incapable of addressing these problems.

On the last point, it is important to remember that the seminal case in the history of regulation in the United States, Munn v. Illinois, grew out of the warehousing battles in Chicago during the Civil War and its immediate aftermath.  The Supreme Court decided that the State of Illinois had the power to regulate grain warehouses, and this decision provided the basis for subsequent exercise of regulatory powers by states and the Federal government.

In other words, what is old is new again.  Journalists and regulators and legislators act as if the kinds of games played today are somehow new and unique.  They aren’t.  The commodities business hasn’t changed that much in a century and a half.  The things that were good, bad, and ugly in 1869 are around today, and will be around in 2069 and 2169.

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May 3, 2013

Chancellorsville

Filed under: Civil War,History,Military — The Professor @ 5:20 pm

Today is the sesquicentennial of the 3d day of the Battle of Chancellorsville.  Jackson’s flank attack on 2 May, 1863 is usually the focus of accounts of the battle, and indeed, it was a daring and brilliant achievement.  But it did not win the battle for Lee and the Confederacy.  Lee only prevailed after a brutal slugging match on this day, 150 years ago.  Wave after wave of Confederates, under command of Jeb Stuart, repeatedly assailed the western side of a Federal salient surrounding the Chancellor house.  And wave after wave was beaten off by Union soldiers of the Third and Twelfth Corps.  What proved decisive was a disastrous decision to evacuate the high ground at Hazel Grove, made by the Union commander, Joe Hooker.  The Confederates seized this commanding terrain, and the artillery planted there proved decisive.  It was perhaps the only time in the war that Confederate artillery decided a battle: there were several fields where Union artillery proved decisive.  Confederate artillerist and memorialist Porter Alexander said of the abandonment of Hazel Grove: “There has rarely been a more gratuitous gift of a battlefield.”

Chancellorsville is often called Lee’s Masterpiece.  And it was, in many ways.  But it also illustrates the ultimate futility of the Confederate cause.  Even after the rout of the Eleventh Corps on the 2d, the Union forces far outnumbered Lee’s and were in a position to carry out a vigorous defense.  Even with the gratuitous gift of Hazel Grove, the Army of Northern Virginia suffered huge casualties to drive the Federals from the environs of the Chancellor House and Fairview.  The casualties were particularly devastating at every level of command.  The battle was a virtual holocaust of division and brigade commanders, field officers, and company officers.  As a result of the battle, Lee had to undertake a wholesale reorganization of his army, and many of those promoted to fill the positions of those killed or maimed on May 3d proved overmatched two months later, on the fields of Pennsylvania.

In brief, even to execute a “masterpiece”, and one facilitated by numerous errors by his opponent Hooker, Lee had to spend lives at an unsustainable rate.  One wonders how it would have been possible to prevail, since even victory was impossibly costly.

Indeed, even the action of the 3d was not decisive.  The Army of the Potomac retreated from the Chancellorsville salient to a more compact position abutting the Rappahannock River, and entrenched it strongly.  It is highly unlikely that it could have been dislodged by an attack by Lee’s spent force.  But Hooker, who had already suffered a loss of confidence and courage on 1 May, and who had been severely concussed by a shell on the 3d, wanted no more of Lee.  Even though a majority of his corps commanders favored fighting it out on the new line, Hooker decided to retreat.  The ultimate victory was due more to Lee’s psychological dominance over an addled Hooker that proved decisive, than to the military dominance of the ANV.

And this worked on Lee’s psychology too, and not in a good way.  Chancellorsville contributed to a hubris that proved disastrous at Gettysburg.

Meanwhile,while Lee was triumphing at Chancellorsville, events were developing far to the west, in the heart of Mississippi.  After months of frustrated attempts to get at Vicksburg, Grant was on the east side of the Mississippi River.  He had beaten back a Confederate force commanded by John Bowen at Port Gibson on 1 May.  He was advancing east, towards Jackson.

Lee fought a masterful battle in early May.  Grant fought a masterful campaign over three weeks of that month.  The campaign proved far more decisive than the battle, as I’ll discuss in future posts on Jackson, Champion Hill, and Big Black Bridge.

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