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 to obtain a forced loan by making the Government contractors bondholders in spite of themselves. The object of the third section of this law was to secure the payment of interest on this loan, amounting to forty millions, by a final appeal to the real wealth of the Southern States. This section imposed a tax of onehalf per cent. upon all personal and real estate—stocks, slaves, merchandise, cattle, specie and bonds of every description, except those of the Confederacy. Estates worth less than five hundred dollars, and the property of colleges, schools and religious institutions, were alone exempted. The difficulty in determining the correct valuation of property and in collecting this tax in a region of country so extensive, and so little inhabited as the Southern States, greatly diminished the payment of it. During the first two years of the war, however, this section did not encounter the same opposition as at a later period, when it was aggravated by new stipulations, and it yielded a revenue which, if well administered, might have upheld the credit of the Confederacy for a considerable length of time; in fact, as will be seen presently, the revenue secured by this tax was nearly seventeen millions in ten months, or about twenty millions during the year 1862. Thanks to these resources and the hope of speedy peace, the finances of the South were at first well supported. In September, 1861, the treasury notes were still at par. In his message of November 10th, Mr. Davis, while recommending the levying of new taxes, presented a favorable picture of the pecuniary situation that was hardly overdrawn; at the close of the year, despite the blockade, which had stopped the importation of specie from Europe, the premium on gold was only up to twenty per cent., which was about the same rate as at the North. In his fourth message, addressed to the permanent Congress, immediately after its installation on February 25th, 1862, the President stated that the expenses of the Confederate treasury during that first year only amounted to one hundred and seventy millions, which, compared with those of the Federals, was a small affair. But he omitted to add that, a large portion of the costs of the war having been defrayed by particular States, this figure did not convey an exact idea of the sum which the struggle had in reality already cost the people of the South. The total issue of government
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