Commercial independence.
An important movement has been inaugurated in
Georgia, by the call of a Convention of the
Commercial classes of the
Confederate States, to take into consideration the means of ensuring the commercial independence of the
South.
It may be laid down as an axiom, that unless the commerce of a country be free and unshackled, its political independence can only be partial and precarious.
The commerce of the
South has, for many years, been disgracefully dependent upon the
North.
It eminently behooves us to inquire into the causes of this dependence.
We have allowed the
North gradually to usurp the entire management of our great staples; to ship them abroad on their own account; to collect the proceeds in specie, or in foreign goods, at first prices, and to pay us for them in Northern wares at double cost, and in imported goods, with a large profit added to what they themselves paid for them.
The staples which we have sold to them have been taken by them at lower prices than Europeans, have been charged; and the goods of their own manufacture, which they have returned us in payment, have been miserable in quality, and much higher than imported articles of good quality would have cost.
Besides the profits which they have made from us in the enhanced prices of the foreign goods, and in the extravagant prices of their own mean goods, which they have sold us in exchange for our staples consumed by themselves or shipped abroad on their own account, they have made large sums of money off of us by transporting our staples to market at higher rates of freight than
Dutch and English vessels would have charged.
They have also made two-and a half per cent, commissions, in and out, on our foreign business, by their agency in transacting that for us, which we could have managed better for ourselves.
The value of the staples which the
South exported to foreign countries was upwards of three hundred millions a year.
The value of these saint staples which she sent
North, for manufacture or consumption there, was upwards of a hundred millions a year.
The
North thus managed a business for the
South of more than four hundred millions a year.
That section had the exclusive monopoly of the carrying trade between the two sections, and so great an advantage in the foreign carrying trade of our staples as almost to amount to a monopoly.
It would be a minimum estimate to say that their revenues from the carrying trade of the
South was fifty millions.
Their profits in the foreign and Northern merchandize that they sold was at least twenty five per cent. or one hundred millions of dollars.
And it would be a moderate calculation to place the amount of the commissions which their merchants and bankers charged on our business, and the expenses of Southern persons sojourning in their cities and at their watering places, at fifty millions more.
Thus, the profits of the
North on Southern trade was at least two hundred millions a year; and all this sure, except such an amount as was fairly payable for the freight on our staples, was a clear earning of the
North, and a useless expenditure or tribute submitted to by the
South.
It was natural that a section making at least one hundred and fifty millions of dollars per annum out of another, which that other ought to have saved, grew rich, and like Jesucrun ‘"waxed fat and kicked."’ It was remarkable only in the circumstance that that other section submitted to the system.
That the
South should remain impoverished, though the richest country on earth, and should fall into a state of abject commercial dependence, under the operation of such a system, was as inevitable as fate.
This exhausting drain and tribute could not go on without creating and maintaining a constant state of indebtedness from the
South to the
North.
This indebtedness rivetted and aggravated the commercial dependence which ensued from the ruinous system of trade in operation.
The effect was to create a system of bank mortgages upon Southern staples, which concentrated in New York, the banking centre of the
Union, the absolute control of Southern exports.
A planter near
Vicksburg or
Montgomery could not anticipate the sale of his crop by borrowing money from the bank in
Vicksburg or
Montgomery, except on acceptances given by his commission merchant payable in New Orleans or
Mobile.
The commission merchant in these cities could not borrow money to meet their acceptances on paper payable at home; but must give acceptances payable in New York.
So it was with tobacco.
The planter, relying upon the sale of his crop, could not borrow money of the
Danville or
Clarksville bank on his ‘"accommodation note"’ payable at the home bank; but must make his paper payable at
Richmond; and the
Richmond factor must, in his turn, put into the
Richmond bank paper payable in New York, which is called ‘ "business paper;"’ for his note payable in
Richmond, called ‘"accommodation paper,"’ would surely be thrown out. Thus, the hundred and fifty millions of tribute to the
North produced a system of individual indebtedness in the nature of bank mortgages on crops; and the vast net-work of banks in the
South became the agents for investing New York with an absolute dominion over the staples of the
South.
Wherever great balances of money are due exchanges are always in favor of that point; and the exchanges being in favor of
Mobile as against
Montgomery, and in favor of New York against
Mobile, the banks make a premium on paper payable at the former points.
So with the banks of
Danville and
Clarkesville as to
Richmond paper, and with the banks of
Richmond as to New York paper; and as all this paper was only a mortgage on Southern staples, the proceeds of the staples when sold abroad, went to New York, the ultimate point of the maturity and payment of the paper based upon it.
Another result followed this course of trade.
Not only did the money for Southern staples due at New York, under the system we have described go there; but the great bulk of the money of
Europe destined for the purchase of our staples, followed suit, and went there also.
Thus it has come to pass, that few bills of exchange, comparatively, are drawn on
England from the
South; but the great bulk of them are drawn by New York, which has thus because the place of deposit for all moneys designed for the purchase of Southern staples.
The Southern planters collect the proceeds of their crops, by means of bills drawn on New York; that is to say, by means of the paper drawn ultimately on New York, which we have described as passing through the net work of the
Southern banks.
It has been proposed to strike at the root of this whole vicious system, by rendering illegal in Southern course all inland bills payable at any place in the
Northern States.
It is for the Confederate Congress to decide upon this proposition.
The body will doubtless be much enlightened in its treatment of this important subject by the deliberations of the Commercial Convention which has been called in
Georgia.
