What major challenges faced the federal government in reconstructing the South after the Civil War during the period from 1865 to 1877?

The Southern states in the aftermath of the Civil War were essentially conquered territory and were, in fact, divided initially into military zones. They had undergone massive destruction from invading armies. The North never completely faced the task of rebuilding the shattered Southern economies and some these states, such as Mississippi, have lagged economically to this day.  While the war meant the end of slavery, and while this was welcomed by people of conscience in...

The Southern states in the aftermath of the Civil War were essentially conquered territory and were, in fact, divided initially into military zones. They had undergone massive destruction from invading armies. The North never completely faced the task of rebuilding the shattered Southern economies and some these states, such as Mississippi, have lagged economically to this day.  While the war meant the end of slavery, and while this was welcomed by people of conscience in the North, this also severely undermined the economic basis of agrarian Southern life. Further, force seldom changes hearts and minds, and while the South had to accept military defeat, many whites in the South clung to their pre-war mindset and wanted to recreate a social order as close as possible to what they had known before the war. 

Complicating the reconstruction of the south was the assassination of President Lincoln in 1865. He was replaced by a much weaker figure, President Andrew Johnson, who championed states' rights. This gave the South the opening it needed to counter the reforms the radical Republicans had at first implemented to give blacks equal rights and an equal voice in Southern politics. Once they could, Southern states moved quickly to restrict black suffrage and the black role in public life. Southerners also used organizations like the Ku Klux Klan to attempt to terrorize the newly-freed blacks into submission to white supremacy. 

Economic depression put Congress back into Democratic hands in 1874. As support for black rights waned, presidents such as Grant and Hayes (who badly needed Southern support) ceded power to white Southern Democrats, leading to a system of segregation that would not be firmly addressed until the passage of Civil Rights legislation in the 1960s.