The New Orleans bulletin. [volume] (New Orleans [La.]) 1874-1876, 1875-03-13
A STATESMAN-LIKE LETTER.

! The New York Herald publishes remarka
0 BILE letter on the subject of money and credit
: written by that eminent Virginia statesman
4 R. II. T. Hunter, who succeeded Slas Wright
! as chairman OF the Finance Committee Of the
United States Senate in 1919, and occupied
9 that position, with great honor to himself and
benefit to the country, until the civil wal
E severed his connection with National affairs.
As the Hnad Justly says, Mr.. Hunter is the
2 most competent judge Of financial subjects in
the South. He is, besides, statesman Of
calm temperament and conservative views,
who frankly accepts the results of the war,
and can have no personal or political object
to promote beyond a sincere and patriotic
desire to contribute to the restoration of a
sound system of finance for the whole coun-
try. The letter is too long for our limited
space, but an idea Of its value may be gathered
from synopsis of its most important parts.
Mr.. Hunter attributes the confusion which
exists in the minds of many upon the cur
rency question to the fact that money and
currency, which are two very different things,
are often treated as identical Money in the
civilized world is specie, and credit is the
promise to pay specie; and even in its higher
form-tha of the bank note-it can never be-
come precisely equivalent to specie. prop
erly organized system Of credit is essential to
every civilized community, but it can never
entirely supersede the use of money. The
large proportion Of the credit of society is the
pledge Of labor to restore the capital loaned
for the purposes Of protection, with some
thing more for its use in the shape ofinterest,
payable at definite time.
| The prosperity ola community depends upoa
the fact that the enterprise shall be of charac-
ter to reproduce the capital employed with
something over to pay the lender for its use
and profit to the producer AS far as posi-
BILE to increase the facilities for this mode of
far as this can be accomplished by govern
ment. If labor were restricted in its use of
capital to such amounts as it could repay in
money, its operations would be SO greatly re-
stricted as to occasion much disaster.
This want is generally supplied by the
banks, who make good the pledges of the in
dividuals who deposit with them, and who
promise to pay interest for the use of the
notes, which they are generally able to do out
OF the profits of their industry. The ability
Of the bank to perform its promise, depends
upon the redemption of individual pledges
But this is not the only mode in which these
banks economic the use of money and open
a wide field for the employment of labor
They take on deposit any surplus OF money
or credit held by individuals, and lend them
out again for the uses Of production, and by
q system Of offsets settle a large amount of
individual and corporate liabilities without
the use of specie. The amount Of wealth pro-
duced in a community where there is sys-
tenn Of credit properly organized, is vastly
gre ter than in one where no such system ex-
lists.
To establish such system, is essential not
only to avoid wasting or misapplying the
capital of the country, but to facilitate the
access of industry to that capital. Has our
government observed either of those rules
Far from it. In the first place, large amount
Of that capital-about eight thousand millions
Of dollars. according to Mr.. Wells-was con
sumed by the war. This may be said to have
been necessary. Still it is a fact, and not the ;
less hurtful on that account. Besides this,
he steam and productive machinery of the .
south, and to some extent of the West, were .
argely destroyed and the capital thus in ,
yested was totally consumed.
The labor once owned by the land owners ..
If the South was emancipated without com .
,ensation and the owner was forced to meet
lebts contracted on the faith of thij property
nd to raise the money necessary to organize :
N industrial system entirely new when CAPT Z
al was scarcest and more of it was required ;
or his operations than ever before. OF !;
curse the system was but partially organized, 9
nd that at deadly expense. This change
lay become ultimately as profitable as was =
he old system, but undoubtedly in its initia- !,
ion it costs great deal more. The land :,
wners made out to live, but did little more
Is tead of creating large surplus as hereto ;,
ore. What little capital once existed in that !.
ection was almost entirely consumed. !
Their banks were entirely destroyed and u
he capital once held by individuals was gen VI
rally lost. The State governments, which, >,
directed and regulated by the interests Of ;,
le people, might have assisted them much, p,
ere placed by Federal Intervention under
lie rule of the ignorant negro and corrupt 4
arpet-bagger, and became actual nuisances b
nd objects of dread to the industrious and Il
ltelligent part Of the community. Credit
as, therefore, impaired to an extent never y
nown before in the South. And yet it was
y this credit that the capacity Of this region O
n producing wealth was to be measured. o
he State banks, which might have kept it rs,
p, had been destroyed by the war and pro- q
lbited by Federal legislation
When the commercial crisis came there II