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Mandeville, LA - Exclusive Video and Audio - What if the Confederacy had been left on it's own? What direction would it have taken? There's too many possible outcomes to count here... and they aren't all sunshine and roses. One possibility is the GRADUAL elimination of slavery in the south because many European countries wouldn't trade with them until they got rid of it, and would've given way to mechanized farming anyways. But there would've been a very different "course of Human Events" as Jefferson said. The western states would've allied with Texas instead of the Northeastern States and so on and so forth. For more on Rethinking the American Union be sure and check out today's Founders TV and pick up Prof. Donald Livingston's Book.
I am Southern and have no guilt for slavery or particular prejudice against the Confederacy, but I do find these more libertarian arguments for constant decentralisation and confederal forms of government untenable. Typically, they are obsessing over abstract idealisations where morality is defined by leaving other people or entities alone while ignoring geopolitical realities and, to some degree, how economic and technological changes affect politics.
A confederation is typical of an agrarian society that is relatively secure from external threats (typically for geographic reasons). It is fitting, therefore, for the early American Republic (though it did face external threats from the British which forced a degree of centralisation) or for the CSA, but would not likely have survived into the Twentieth Century, at least not without these sections of North America falling into the satellite orbits of foreign powers like Japan, Britain, France, etc.
I am not saying "Empire" is inevitable, that is a conscious choice. But any modern sovereign country has to have a strong central government.