The Madisonian., 1840-01-28

OF $40, 700 0OO and The sudden liberation OF ieAas-
both Of which circumstances added greatly TO The
general spirit OF speculation.
will now make few remarks on the preceding
description Of reyulsion produced by nuctua'ion
in the price Of cotton; and, rsl II is 10 be remarked,
that the price u cotton Is regulated by the foreign
market, and, consequently, is independent Of our
banking system. The latter, therefore, could not,
BY its action have generated those high prices which
were the cause OF the speculation. The only mate
rial influence which our banking system can exert
on the price Of cotton, must consist In The facilities
offered 10 the great commission and exporting mer-
chanls--and this must be ackno9 ledsed TO be mos
saluary one In every great agricultural country,
The important Of the year are those when The
crops are brough, forward for sale, and foreign
good, are imported. Al those seasons, an expanded
currency is required while, al others, contracted
one will answer.
The best system, Ihen for such purposes, must be
one that will admit Of expansion and contraction
10 sui, the times. The banking system, II II will
only eonine i,se principally, TO business paper oil
short dates answers best the condition OF The pro-
blem. Il enables that highly Important mercantile
agency, which must come between the farmer and
the planter on The one side, and the manufacturer
and consumer on the other, perform its functions
in The cheapest and mos, eticacious manner, thereby
enabling il 10 nd over 10 the producer The largest
possible portion Of that price which is realized in
the foreign market, Il is very true that withoutlhe
banks, this agency must and would exist, but il Is
demons rable, that although ,h. credi system would
DC equally extended before, yet would this agency
be performed In more clumsy and costly manner,
and as prices would not be altered in Europe, The
whole additional cosl must come out Of The pocket
Of the producer and thus form deduction from his
nett revenue.
will now, sir, endeavor TO point out some Petu
harities in the cotton business, which make revul-
sions in our country more disastrous than in most
others. | think ii those pecuiarities were more at
tended TO- that much Iu>ter views would be formed
Of The comparative char cter oi our banking sys-
tenn And, 6rst, will call your attention 10 the ef-
feet produced by the tact that, 50 large portion OF
our exports consists oi single aiticle (cotan,)
II The value of ports div ded more equally
over a great variety of commodities, there would be
scarcely possibility of sudden reyulsion in the
prices Of all al any one time, and change taking
place in the prices OF one or more, would not be
likely 10 produce a great national conraision. Tie
revulsons in trade would be more partial, and
quickly recovered from. But on every great change
in the price of SO important staple as cotton, you
are in great danger Of general crisis. Another
peculiaIiiy pregnant with mcst important conse-
quences is the FACT tha, this commodity is produced
alone in one great territorial division OF our Unlon
and that in that DIVISION in The season OF prosperity
il is almost The only article produced You will see,
st once. that If commodity, equally valuable, IN
The aggregate raised indiscrmnatey, all over
the Union, The fluctuations in its price would not
produce any hing like The same disastrous conse-
quences. A speculation and Ievusion in the cotton
business if may compare great thing with lit
lie one, would be more like The moruS mutcaulis
humbug; it would be di. ided among 100 many 10
have very concentrated and powerful effect. The
man of wealth, who has embarked few hundred
dollars in morus, is no, much injured by its loss
So il the farmers, throughout the Union, only had
cotton patches, we Virginians have, Revision in
the business would not bring such deep distress on
he country But an immense crop OF cotton Is
made in the South alone, hence every trade and pro-
iession and form OF credit, in that whole region,
must be directly or indirectly connected with this
great business. When lands and negroes are there
bought on credit il is upon the faith OF the subSe-
quent cotton crop When the merchants import
goods from New York and Philadelphia ON credit,
II is done the same basis, Tor their dealers are
planters The whole supe rstructure Of private ere
dit is built upon the foundation; and Is i'm
possible for the banking system, in such country,
10 do business otherwise than upon the security OF
the same great occupation. Under such circum-
stances as these il is impossible, IN the nature OF
things, but that the first great depression ia the price
OF cotton, mus, produce deep distress throughout this
whole region. Scarcely any profession can escape
it, Bank credit, like all others, must Of course sus
tain shock and these institutions are the most
prominent portion Of the credit system, and form the
r,sibe links in the connection between the Gre
dit system ol the cotton country and other portions
Of the Union, those who look at events specifically,
will ibe the blame 10 them which is, in fact,
due 10 the mmulabe laws of trade, and the unvarv
| ing nature Of man.
But let us see little farther how The distress Of the
cotton country becomes greatly augmented, by The
| fact that cotton is almost the only article produced
| by each planter. And to this end, will compare
together The cases of two farmers--one who raises
breadsufs, and the other cotion--in order that We
may see The great difference between their cond-
lion in sudden fall Of prices In the of the
grower OF breadsufs, he supplies, from his own
| farm, the principal parl of the years expenditures
he feeds his laborers and TO great extent, clothes
| them from the farm; and these The heaviest
items in the cost OF production With the grower
OF breadstuffs, the maxim seems TO be to make as
much within himself as possible, hence what he
sells is surplus which is almost all 'leA profit
Now, suppose a sudden fall in bread,lufs il the
farmer be not in debt he may not be much distressed,
for 10 that portion consumed on the farm, he
ceves no injury his only injury then, will be di-
minuiion OF his nett revenue. Take the case
OF the cotton grower, when cotton sells very high,
he will make scarcely any thing else, for moth
ing yields him so high profit as cotton. All that