Alexandria gazette. [volume] (Alexandria, D.C.) 1834-1974, 1875-03-09
II. NJ. T. Hunter on Southern Finance.

- -
The New York Herald publishes a letter,
written at its request, by MIR. r. Nj. T. Hun
ter, of Virginia, on the financial question. MIR.
Hunter served as chairman of the United
States Senate committee on finance from lS49
to 1861, a strong evidence of the high estimate
entertained by his party OF his financial ability.
Mr.. Hunter regards the destruction of the
State banks by federal legislation as a great m
pediment TO Southern prosperity. For a CON-
munity which has been exhausted and pros
trated by a desolating war the first necessity is
ability to command aud utilize capital. Banks
create 10 capital, but they are indispensable
agencies for extending and strengthening credit,
and the ~Datioual banking law has virtually de-
priVed the South Of this great resource by des-
troyiDg the State banks. Had the South been
able to substitute rational banks 10 their place
as was done 10 the North, the evil be holds
would have been slight. Bnt under a system
which requires heavy deposits OF federal bonds
the Southern people, who were not the owners
of such bonds, we're deprived of the ordinary
facilities Of credit.
1.-THE State banks had been permitted to
stand, Southern regeneration would not nave
been so fatally obstructed. Banks could have
UCcu OIkdulLCu auu W SOSb piOpSiiy os
the Southern people possessed. The bonds of
their State governments, the municipal bonds
of their cities and the bonds Of the Southern
railroads would have been availed for that pur-
pose, and numerous local banks could have
made advances to the planters on the strength
of their growing crops and their real estate.
But the property of the planters could not
enable them to borrow money IN distant parts
of the country, and they were deprived of the
great advantage OF an organized system OF home
credit. What would have been the condition
of the North if, when the State banks were
destroyed by federal legislation, they had been
unable to supply their place by other instltu-
tions?
MIR. Hunter discusses emancipation only in
its financial aspect. % this point be says:
1.-THE labor once owned for the most part by
the landowners of the South was emancipated
without compensation, and, whether this was
right or wrong, the owner was forced TO meet
debts contracted on the faith of this property,
and to raise the money necessary to orgaEize
an industrial system entirely new when capital
was scarcest and more of it was required for
his operations than ever before. Of course the
system was but partially organized, and that at
a deadly expense. This change may become
ultimately as profitable as was the old system,
but undoubtedly in its initiation it costs a great
deal more. Much of the old system of produc-
ton 10 the South, once so profitable, was
abandoned, and when partially resumed the
cost was so great as to leave but little profit to
the producer. The landowners made out to
live, but did little more, instead Of creating a
largo surplus, as heretofore. What little CAPT
tai once existed 10 that section was almost en-
tircly consumed.
Their banks were entirely destroyed, and
the capital once held by Individuals was gener-
ally lost. The State governments which, if d.
rected and regulated by the interests Of the
people, might have assisted them much, were
placed by federal Intervention under the rule
of the Ignorant negro and corrupt carpet-bag-
ger, and became actual Duisances and objects
OF dread to the industrious and Intelligent
part of the community