The Washington herald., 1914-10-02
Caution y Emsrgeney Measure..

our country which has been hit the hardest by the
European war is the South The South usually sends
abroad each year twothirds of its great crop of cot
ton the value of these exports being perhaps $780,
100000 This year the export demand for cotton has
substantially ceased and the demand of the cotton
mills in our own country for raw material has also
been greatly lowered. Naturally the Southern plant
ers are distressed They cannot market their crop
their usual way. The cotton exchanges are closed
and sales of cotton for future delivery can no longer
be made 1t is needless go into detail concerning
the financial loss and the business trouble that may
ensue from this cause. But there are two great
truths concerning the matter that we wish to en-
phasize.
One of these is that graphic illustration is being
afforded the South of what happens when the BUSH
ness of dealing in cotton for future delivery is abso-
Iutely suspended All over the world just now, and
especially in Europe cotton manufacturers are not
making any provision for the future needs of their
business. They only buying cotton for immediate
daily consumption, and as they already have good
store of the staple hand these purchases amount
to practically nothing at all The worlds business in
cotton is in the shape as it would be if cotton
manufacturers were prevented by law from making
provision for the needs of their business in advance
that is to say if (as has been suggested by of
our eager friends in Congress) law should be pass
ed stopping dealings in cotton futures Many of our
Southern friends have an opportunity Of seeing per-
haps for the first time. what it means when some
great obstacle to the natural conduct of business is
erected.
The other truth is that the cotton business is
vertically in abnormal condition, and that it is
both impossible and undesirable for the government
to attempt to make this business normal at the ex-
pense of the whole country Every business interest
=
is likely to suffer for considerable time to come.
The producers of copper are almost as bad off as
the producers of cotton are and have as much right
to ask that the government interfere in their behalf
If the government is to attempt anything re-
motley resembling a "valorization" of cotton there
is no logical why it should not attempt to
valorize fifty or sixty different other commodities
and to lend money outright to fifty sixty different
industries.
The principle in extending help at such time
this is to extend help that it benefits everybody
and not one particular interest. The danger about
helping anybody in particular to the exclusion of
others is that an improper speculation is almost
tany fostered in the one business that is helped If
the cotton planter has his bales of cotton carried
for him until such time as he sell them at what
he calls a normal price, the cotton mill owner is
thereby asked by the Government to hold the price
of his goods at a level higher than prevails in the
open market for these products where the unchecked
law of supply and demand applies
We do not say this in criticism of the measures
which the Treasury Department has already author
lied in this emergency but think that there should
be some limit to the amount of emergency currency
that is issued in aid of the Southern planters hard
the case of these planters is Indeed think the
issue of emergency currency has been carried far
in the country generally the present condition of
affairs seems to warrant Three hundred million
dollars of this currency has already been issued if
we correctly informed, and cannot why
any should be issued for the time being unless
the government wishes 70 to the aid of specu-
lators. All of us, whether we be merchants, farm
ers. or government officials must remember that 4
farmer or planter who wishes to hold" his wheat
or cotton for higher prizes rather than sell it at
going market prices is no less speculator than the
gambler the cotton produce exchanges who
is doing exactly the thing through the agency
of brokers and the option market. Neither, the one
nor the other, should expect the government to
carry" his operation
As matter of fact, the cotton difficulty seems
to be working out more favoraby than thought
possible few weeks ago. Some of the great COM
panies which have enormous dealings with cotton
producers and are large actual and prospective credit
ors of these producers, taking their pay from
their customers in cotton bales. Indeed, we think
that warehouse receipts for cotton taking the
place of money in necessary business transactions
to extent not generally realized, while in the last
week or so cotton is beginning to more freely
from the plantations After all. there is no war in
England itself, and it cannot be expected that the
great cotton mills there will shut down for a very
prolonged period The difficulty that has arisen is
caused by what everybody realizes is temporary
adversely, and rely upon the good sense OF the
American people to find a way out of the difficulty
without resortng to means which will imperil the
credit of the whole nation.