In the wake of the Civil War, and with Reconstruction in full swing, the South was in no position to prevent the imposition of the new state of affairs by the victorious North. As there were no formal political mechanisms available to challenge Reconstruction, a number of Southerners resorted to criminal methods such as arson, intimidation, and murder against both newly-freed slaves and white officials administering the new policy. Spearheading this campaign of terror was the white supremacist terrorist organization, the Ku Klux Klan, founded by Nathan Bedford Forrest, who'd served as a Confederate general during the Civil War.
Though the vast majority of Southerners were white supremacists, most people did not support terror and violence. On a practical and political level, the activities of the Klan merely served to make Northern politicians all the more determined to impose Reconstruction on the South. So as well as being criminal and morally reprehensible, the terror tactics of the Klan were also self-defeating.
A growing consensus emerged that the South simply needed to bide its time until the powers that be in Washington grew tired with Reconstruction and either watered it down or abandoned the policy altogether. And that's precisely what did happen. Over time, Reconstruction became a political liability, and most voters in the North wanted to move on. The subsequent abandonment of the policy allowed the Southern states to reintroduce the substance of slavery if not its form in the shape of the notorious Jim Crow laws, which would keep African-Americans in subjection for the better part of the next hundred years.
The tactics of white supremacist groups forced the federal government to respond with heavy-handed measures to suppress them. This led to the extended occupation of the South by the federal army and the punishment of Southern officials for permitting the persecution of freed slaves. Of course, this all ended with the end of Reconstruction and the beginning of the Jim Crow era.
The period of 1865–1877 is known as Reconstruction. This was the period in which the federal government occupied the eleven states of the former Confederacy in order to protect the rights of newly freed slaves.
This period also saw the rise of several active white supremacist groups, most notably the Ku Klux Klan. These groups set about terrorizing newly freed slaves and denying them their rights. This ended up backfiring in some ways. Starting in 1870, President Grant signed a number of bills known as the Enforcement Acts. These acts permitted the federal army to intervene to protect the rights of African Americans in the South. Much of the former Confederacy was occupied once again by the northern military in order to achieve this mission. The intimidation tactics utilized by the Ku Klux Klan were made federal offenses, and state officials were held liable for denying rights to African Americans. As a result, the Ku Klux Klan and other groups were forced to disband for some time.
http://m.american-historama.org/1866-1881-reconstruction-era/enforcement-acts.htm
The period of Reconstruction saw the rise of the Ku Klux Klan in the South. Initially created as a veterans' organization, it quickly turned into a group which terrorized the African American population in the South and anyone who tried to help them. This hurt the South overall. It became harder for investors to develop the South because they knew that they could not fully use both white and black workers in the same plant. This lack of investment made the South even more dependent on agriculture and sunk the South further into poverty. Also, lynchings and other attacks on black citizens forced the federal government to address civil rights. Under the Grant administration, the military was called out in order to deal with the Klan. While Reconstruction ended in 1877 and lynchings and discrimination continued well after that, the Klan's power was severely diminished until a revival of the Klan in the 1920s.
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