Why does my neutral read 115v with respect to ground?
The dead wire was probably intended to tie into the live wire and head on down the line. 
Someone probably had a “brilliant “ idea to use the neutral as power and the ground as neutral. While it will give you power it is of course very dangerous.  Look in the panel and see if there is a white wire going to a circuit breaker. Most likely the splice was made in a junction box somewhere.