The Union times. [volume] (Union, S.C.) 1894-1918, 1914-04-03
SENATOR SMITH EXPLAINS
FULL TEXT OF COTTON BILL.
Talks of Measure to Regulate Ex.
change-POsitiOn of Futures.
South Carolina Expert Points
to Popularity of Traf-
fic in Cotton.

washington, March Ex-senator
Smith of South Carolina in bringing
up his bill to regulate the sale of cot
ton on the New York cotton exchange
today made a speech in which he out
lines just what the bill would do if
enacted. The measure seeks to COM
pei the exchange to adopt the gov
ernment's standardization, which In
effect would result in the grade of
of an inferior grade as at present.
Senator Smith said:
There is perhaps no communit,
that is fraught with so much inters'
to the American people, and possi-
bly, none as little understood and ap-
preciated. The members of the SEN
ate ought to know, as perhaps most
of them do know, that the balance of
trade of this country with foreign
countries depends entirely upon our
expectation of raw cotton. 1t has
grown from 100000 to 100000
bales in 1860 to between $4,000, 900
and 100000 bales in the last de-
cade.
"The practice of selling cotton and
the method by which it is sold is
peculiar. Possibly it is the only con.
modify that is sold under the peculiar
methods which characterize the sale
of cotton. The method has become
so thoroughly established that we arc
absolutely dependent upon the ex-
changes for the fixing of the price of
our cotton. That is the reason for
the introduction of this bill, and it is
our hope to regulate this method.
81 have heard discussions here on
the floor as to the regulation of in
terstate traffic, as to the regulation
of commerce, but none of these forms
of organization and corporations have
taken from the people the profits that
the people as producers were en-
titled to. Common carriers and man.
ufacturers may have and doubtless
do charge eXorbitant prices for SER
vices rendered, but the cotton ex-
changes really take from the pro-
ducers the profits to which the pro-
ducerS are entitled.
"In 1870 the New York cotton ex-
change was organized under the laws
of the State of New York. On the
New York exchange from January l
future contracts were 1O1 .663 bales.
and the spot sales were 673,563 bales.
In 1870, the New York cotton ex-
change had future sales amounting to
591 $3.50 bales and the spot sales were
616,41O bales. One year later, when
they had fully organized and got the
idea of the future contracts, the sales
OF futures were 100000 bales and
the spot sales were 733,9O5 bale,
Since that time the spot sales have
dropped to a negligible quantity. No
statistics have been kept accurately.
but it is alleged that the sale of spo,
cotton during the last year was some
thing over 100000 bales, while for
the last few years the sales of fu-
lures have amounted to from 3OO,-
100000 to 400,000,00O bales"
Senator Smith called the attention
OF the senate to the fact that cotton
is divided into certain grades on ac-
count of color, foreign matter and
strength of fibre. The practice of
fixed differences" is a comparatively
recent practice.
$50 long as the exchanges are q,
lowed to sell one thing and deliver
another, at difference in price fixed
by the seller" said Senator Smith,
the man who enters that market Is
at the mercy of the man who owns
the machine and runs the system"
Senator Smith called attention to an
article in the New York Commercial
which, he said, characterized the
practices on the New York cotton ex-
change as "bunco game" and stated
that they blackjaded any man who
dared to go there to demand the de-
livery of cotton.