Cotton and the Cotton Trade [pp. 448-454]

DEPARTMENT OF COMMERCE.
pelled to labor under in their efforts to compete with other countries. The
steady decline in the price of cotton during late weeks, and the reported
prospect of a large crop in India, are also likely to have the effect of discouraging cotton growing. On the other side, it would be difficult to specify
any considerations calculated to induce extensive planting."
To these considerations may be added another which occurs to us. In the
fall of 1865, landholders in the South found but little difficulty in securing
Northern capital wherewith to restore their ruined farms, to replenish necessary appointments, and to provide provisions and labor requisite to the production of a crop. For this accommodation, relying upon a continuance of the
then high prices, the most extravagant premiums were offered. Fifteen,
twenty, and even twenty-five per cent. per annum were the current rates
paid by hundreds; while others, more fortunate as events have proved, gave
a third, or a half interest in the results, for the use of the capital furnished.
It is hardly necessary for us to add, that the experiences of the past year
have been, to say the least, as discouraging to the capitalist as to the planter, and we speak by the card when we say, that not one in fifty of the contracts or loans of last season have been renewed, and certainly not one per
cent. of the new applications for capital for planting purposes has been successful. Nor is this unwillingness on the part of Northern capitalists to
embark their surplus wealth in planting enterprises at the South wholly to
be condemned; it is the natural result of the uncertain condition of things,
so unnecessarily prolonged in that unhappy section by the determination of
Congress so to model the forms and conditions of reconstruction as to perpetuate the lease of radical power, and by the blighting effects of each successive step in this republican programme upon the value of such securities
as the planter alone can offer. Capital is pre-eminently selfish, but equally
restless, and good security is a sesame that will cause the bars to fall, the
bolts to shoot back, the doors to stand invitingly open, and the smniling
millionaire to bring forth the contents of his vaults and coffers without
stint. Can the South tender this good security? Let us see. The majority of loans negotiated in 1865 and 1866 for account Southern planters
were based upon mortgage, or actual transfer of lands, at what was then
thought to be a ruinously low valuation. In a few cases Southern State,
municipal and railroad bonds were pledged at a liberal margin on the then
current market value, and, as we before observed, some of the contracts took
the form of actual copartnership. Like results have followed in all these
cases. Owing to the increased scarcity of money in the South, the choicest
lands, which ten years ago were, and ten years hence, will be mines of
wealth to the owners, are now offered for a mere song, and under the baneful effects of radical misrule, the Southern State and corporation bonds and
stocks have in nearly every item of the list largely declined. To illustrate:
A loan of twenty thousand dollars based on bonds of a Southern Statewhich ruled before the war at par to three and five per cent. premium was negotiated in New York in March, 1866, on a valuation of forty cents
on the dollar for the bonds, the market value being from seventy-eight to
eighty cents. This loan matured on the 6th of last March, immediately
after the passage of the Sherman Reconstruction bill, and so prompt were
the effects of that legislation, that the owner, who had refused fifty for his
bonds but a few weeks before, obtained no better offer than twenty-five for
them, and would have been compelled to sacrifice them at that figure but
for the indulgence of his creditor. WVe know of instances of loans on lands
at a valuation of ten dollars an acre, which under foreclosure would not
realize fifty per cent. to the lender, and of those who supplied the funds for
planting in joint account, but a small percentage will be tempted to renew
their contracts.
There is another element of disturbance at the South which will affect in
an appreciable degree the prospects of the growing crop. We refer to the
political agitation which the introduction of a new voting power has al ready engendered. Herculean efforts will be made by the party in power to
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