The Charleston daily news. [volume] (Charleston, S.C.) 1865-1873, 1870-12-06
SOUTHERN CREDIT.
The. cause of Depression and the Means
of Restoration.
,Eronn ,he New York Rul!elin.l

tt is unfortunate for the South tnat, al
time when the reconstruction OF us 1unneeS p5 %
required the control OF lts ste naiii;coi aG.
venturers. There was time when II was SUM
cient gual antee Of Southern State oolEaLiOn
that it was backed by southern men OF lIneAO!e Sa
there is scarcely State In the South whose deDts
have this ssrt Of backing. For the last hve years
the finances Of the several States nave oeen con-
trolled by men who have acquired poslt.oa
upon the war. With no experience In statesman.
ship or finance, and no record but that OF adven.
turerS these men have undertaken 10 readJust
the revenues and debts OF me Sta,es aiecs Saow
with these raw fEancers has not been The goou
credit Of the State. but the manipulation OF ine
finances 30 as to produce the largest poss0ie gaHs
ont OF speculation. Their schemes have been, IN
most cases Matched in Wall street banking houses;
and the legislators, governors and officials have
been paid tools for carrying out the plans OF
shrewd bankers. The main point aimed a. was was
In the prices Of the State bonds, lrrespec
tive OF the interests OF the state. the par
ty to be s'milkedn being the innocent public.
TO issue new obligations to provide for their over
due bonds or their unpaid interest. These new
issues have In most cases been put out oy secret
sale on the market aud IN amounts known only
to the negotiat r and the clique. In anticipation
of the issue the parties to the secret would sel on
time large amounts OF the State securities and so
soon a. the new bonds had been marketed, the
fact would be announced with the result OF
heavy fall in the market value OF the obligations
atfori;ng the 'ling' spectators an opportunity
for covering their previous large sales. In other
Instances legislative. ring" has authorized
large issues Of bonds to railroad sch" mes, fur
which there was no necessity arising ouL Of
the commerce Of the State. These loans
had the double speculative advantage OF inVolv.
ing large contracts for building the roads and OF
Welding profit on the manipulation OF The bond
Nh q N IN fallluU
the hands OF The clique. In other instances the
political Specuators have sought Illicit gains
through faciitious expedients for stimulating the
credit of the State. In these cases they would
first OF all buy through New York capitalists large
amounts Of ihej obligations, and then augment
the taxes TO retire unexpectedly considerable
amount Of debt, and, "a stili further expedient
compel certain corporations doing business
within The State to hold considerable amount OF
the State obligations, which the corporations had
to buy from the clique.
coulrived to make large profits directly through
commissions paid by the bankers negotiating
loans for the State. We know OF instances where
finance officers have boldly proposed, In letters 20
the sale OF securities, provided the allowance
should be divided with them. And equally posi-
BILE would 1t be to cite ins! anceS IN which COVER.
nor or comptroller have deliberately involved
the State in advances lpOn secret issues OF obli-
CATION, the effect Of which could only be to en-
6arrass the finances and weaken TIE credit OF the
government.
We allude to this dscIedI,able management nf
State finances at the South for no other purpose
than to promote public investigation and 10 re-
deem the credit OF the Southern governments
from the fathleSs hands into which 1t has lnlle1.
A knowledge OF these abuses ought to suffice for
their overthrow and for the banishment OF po.
lltical specuat0rs from public position. There Is
but one means OF restoring the credit OF the
Southern States. viz the restoration OF unim-
peachabe Southern citizens nf the old standard
to representative and official positions. Men OF
wealth and ability aud character cannot afford 10
stand sullenly By and witness the degradation OF
their State by ipteropers and adventures. They
have an interest in their section which the new
element have not and cannot have; and it be.
comes them 10 assert their claim TO the actual
government OF their States. When Southern honor
and craftsmanship are again infused into the
local governments we shall witness vast and
permanent Improvement in Southern credit; but
not before.