I love to look at the Early Modern Period and the Modern Age through a capitalist lense. I see the significance of capitalism in almost every turn of historical events when I read the excellent book “Americana: A 400-year history of American Capitalism” by Bhu Srinivasan.

After I read the chapter on the American Civil War, it dawned on me that it can be explained as a war on supply chains. The Union won because it deployed the right logistics strategies on itself and on its opponent. The Confederate lost because it lost control of its supply chains, both internally and globally.

First, I was very much intrigued to know Andrew Carnegie played a non-trivial role in the war:

  1. Railway Repair: He supervised the repair of rail lines from Annapolis to Washington D.C., enabling Union troops to reach the capital quickly.
  2. Telegraph Operations: Carnegie was appointed Superintendent of the Military Railways and the Union Government’s telegraph lines in the East. He personally oversaw the organization of the telegraph service, which proved crucial for Union communications.
  3. Troop and Supply Transportation: Following the Union defeat at Bull Run, Carnegie personally supervised the transportation of defeated forces. He also arranged for the shipment of munitions from Pittsburgh’s Allegheny Arsenal to Harrisburg, Pennsylvania.

Those are all about logistics! And in particular, with the utilization of telegraph the civil war was being carried out with almost full instantaneous information transmission, which was truly remarkable.

Secondly, the Union had the brilliant foresight, and the military power, to cut off the main supply line of the Confederate – the ocean transport between Europe and the South. The southern states were critically dependent upon selling their cotton to and also importing steel from, the UK. According to the book, in 1864 the cotton production in the South fell a whopping 93 percent from its prewar level. Without the cotton trade, the South cannot fund its war. It cannot repair its own aging and broken railways. Its economy collapsed.

No wonder the book claimed that “there is a case to be made that the Civil War was not won on land at all.” I would make a slightly different case. In my view, the war was determined by who controlled the supply chains that empowered the commerce.