The Birmingham age-herald., 1914-10-06


 Washington October 5.--(special) )-sig- governor oe Alabama just prior to his departure from Montgomery for Wash inaton to attend the National Cotton congress that constitutional action prob ally offered the most adequate remedy for the cotton situation, is a letter from Senator John II. Bankhead to the people cf Alabama urging that a especial session of the state legislature be called to deal exclusively with the cotton situation.
 MT. Bankhead writes one of the farmers of the Senate who sees the re- sponsibility and emergency confronting the cotton growing sections of the coun- tr, and strongly urges that prompt ac- ton be taken to remedy conditions He points to the fact that the recent con- ference of governors accomplished little Of real benefit. and declares that the efforts of congressman from the cotton growing states, owing to their great mi nority, can do little so far securing federal aid In purchasing the staple is concerned. Other sections, says MT. Bankhead are injured by the war and they are demanding federal assistance, as is the south. To allow the people of the south to believe that such aid is probable, according to the Alabama sen ator is unjust. They are just beginning to feel the situation. They should be given the truth i'll order that they may be prepared to meet it.
 After a careful consideration of all plans offered for immediate relief, MT. Bankhead declares the one he is offering he believes is the most feasible. His letter in part reads as follows:
 Let the governor call special ses- sion of the legislature at once for con sideration of the cotton situation alone. The danger of ruin to our people is so great that no member would dare trifle with the welfare of the people by try ing to inject state politics into the deliberations. Have the legislature sub init to the people in a. special session called as quickly as possible an amend ment to the constitution authorizing the state to issue bonds in the sum of $40,000, 0o0 It is estimated that 100000 bales will be raised in Alabama, if the entire crop is picked. The state should buy at i0 cents pound one-half of the crop of each Alabama producer. Forty million dollars would be required to buy the Soc, 600 bales. The bonds should be issued in denominations of s10, $25, $50, $100, $500 and 5000.
 It is impossible at this time to sell bonds in the market, so that it would be necessary to pay for the cotton with the bonds.
 The legislature should provide ware house system, either by the state or au- thorize the counties to establish ware houses in counties where existing ware- houses could not be properly bonded.
 Under the plan, a farmer would take his cotton to the warehouse and get his warrant. He would then take his ware house warrant to the probate judge, or some other agent designated by the state and get bonds for his cotton at 10 cents per pound.
 How About Bonds?
 The question will be asked: What will the farmer do with the bonds ?'' His merchant will accept the bonds in payment of debts or for the sale of goods. The banks will accept the bonds in pay ment of notes. What merchant or bank or had not rather have the states bond, secured by the cotton, than a debt against . man who had no means of paying?
 It may be asked, How will the mer- chant pay his debts with the bonds?' The banks will take them, and when they need money, the national banks can send them to Washington. and get 90 per cent In currency on them, and when the state Is ready to redeem them, will get the other 10 per cent.
 The bonds should bear per cent inter est The advantage of d low rate of in- terest is threefold. It will not impair the credit of the state; it will not be too great a burden in paying the interest," the bond will not be sufficiently attrac- tive as an investment to justify those with small means to hold 1t and 1t will pass from hand to hand, so that one $50 bond may pay several hundred or possibly many thousand dollars of debts under this process of liquidation.
 The bonds should be payable or before three years from issue. with inter- est payable annually.
 The interest on this bond issue would De $1.600,000 per annum. This bond in- erest should be raised by levying tax N r bale on that part of the present rop sold to the state, and a tax of 50