<P> Small - scale riots broke out in ethnic German and Irish districts, and in areas along the Ohio River with many Copperheads . Holmes County, Ohio was an isolated parochial area dominated by Pennsylvania Dutch and some recent German immigrants . It was a Democratic stronghold and few men dared speak out in favor of conscription . Local politicians denounced Lincoln and Congress as despotic, seeing the draft law as a violation of their local autonomy . In June 1863, small - scale disturbances broke out; they ended when the Army sent in armed units . </P> <P> The Union economy grew and prospered during the war while fielding a very large army and navy . The Republicans in Washington had a Whiggish vision of an industrial nation, with great cities, efficient factories, productive farms, all national banks, all knit together by a modern railroad system, to be mobilized by the United States Military Railroad . The South had resisted policies such as tariffs to promote industry and homestead laws to promote farming because slavery would not benefit . With the South gone and Northern Democrats weak, the Republicans enacted their legislation . At the same time they passed new taxes to pay for part of the war and issued large amounts of bonds to pay for most of the rest . Economic historians attribute the remainder of the cost of the war to inflation . Congress wrote an elaborate program of economic modernization that had the dual purpose of winning the war and permanently transforming the economy . For a list of the major industrialists see . </P> <P> In 1860 the Treasury was a small operation that funded the small - scale operations of the government through land sales and customs based on a low tariff . Peacetime revenues were trivial in comparison with the cost of a full - scale war but the Treasury Department under Secretary Salmon P. Chase showed unusual ingenuity in financing the war without crippling the economy . Many new taxes were imposed and always with a patriotic theme comparing the financial sacrifice to the sacrifices of life and limb . The government paid for supplies in real money, which encouraged people to sell to the government regardless of their politics . By contrast the Confederacy gave paper promissory notes when it seized property, so that even loyal Confederates would hide their horses and mules rather than sell them for dubious paper . Overall the Northern financial system was highly successful in raising money and turning patriotism into profit, while the Confederate system impoverished its patriots . </P> <P> The United States needed $3.1 billion to pay for the immense armies and fleets raised to fight the Civil War--over $400 million just in 1862 alone . Apart from tariffs, the largest revenue by far came from new excise taxes--a sort of value added tax--that was imposed on every sort of manufactured item . Second came much higher tariffs, through several Morrill tariff laws . Third came the nation's first income tax; only the wealthy paid and it was repealed at war's end . </P>

Which side had more money in the civil war
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