reed of native resources. In every one of the years of scarcity in question, we were considerable exporters, by the help of bounties which existed from the Revolution, and which enhanced the cost to the consumer, without having the slightest effect in producing steadiness of supply. From 1757, about the era of the commencement of the cotton manufacture, and consequent rapid increase of population, we began to import largely; and importing and consuming more than we exported, England became virtually an importing country, the export being factitious. From 1757 to 1793 prices, with agricultural improvement, became more steady, and ranged only between 369. and 528. Foreign corn, for the protection of landlord rent, being all the while subject to a duty when wheat was under a certain price. The object aimed at in this kind of legislation seems to have been, never to allow the price to fall below 51s., or thereabouts; for, when under this, the duty levied on the foreign article ranged, as Mr. Brown has shown, from 17s. to 25s. a quarter. Thanks to Peel, Russel, and free trade, we have our bread corn at this moment, with more than double the mouths to feed, by 11s. a quarter below this long-cherished landlord standard. In the third year of the war of the French Revolution, the price of wheat rose to 75s., and in the fourth to 788. In 1798 and 1799, with war and a depreciated currency, it rose to 113s. and 119s., and with the same bad allies in 1812 it rose to 126s.-that is, to between three and four times its present cost, and about 180 per cent higher than it was in the years of famine-1739 and 1740, the last of which was emphatically called by the Scots, the black, or direful spring. From the year 1823 downwards to the entire exploding of the system in 1848, a direct tax on bread has contibuted to the public treasury. In 1842 this tax produced £1,194,615, and in the whole period it has yielded to it, as we find by Mr. Brown's table, £7,661,100. It is quite certain, then, that the whole affair, bounties, duties, and sliding scale, from the first days of King William to the last days of Robert Peel, has been virtually a swindle on the public, the swindlers all the while laboring under the strange hallucination that they were honest men, and even patriots in a sort of breeches-pocket sense." FOREIGN AND DOMESTIC EXPORTS FROM UNITED STATES FROM 1821 TO 1851. In this particular branch of trade, Boston averages quite as large a business as New York, as the following comparison will show : We also annex a statement of the quantity of certain leading articles of produce shipped from New York to foreign ports for the year 1851: The above shows a large export business; but the prices of many articles of produce have so far declined that the relative value has not been equal to the relative quantity. The following is a comparison of the Exports from the same port of some of the principal articles for the last two years: ..lbs. 2,221,258 ..pkgs. 19,195 Manufactured...lbs. 3,798,354 1,802,526 It will be seen that the shipments of wheat have largely increased, while Indian corn has been less in request. The Secretary of the Treasury, and others who are honestly and earnestly endeavoring to regulate the course of trade by rules of their own making, are troubled in view of the possible falling off in the value of our exports, and the probable continuation of our large imports. It would not be difficult to show, that the increased export value of cotton, and increased supply of gold coin, which came, as these writers think, so opportunely to balance the increased imports, were the chief cause of the extra supply of foreign goods; so that there was less chance in this balance, than the operation of regular and natural laws. JOURNAL OF BANKING, CURRENCY, AND FINANCE. "MONEY OF PAPER, OR INCONVERTIBLE PAPER MONEY." PELLA, (HOLLAND SETTLEMENT,) IOWA, December 30, 1851. FREEMAN HUNT, Esq., Editor of the Merchants' Magazine: SIR-I have read in your number for December, which reached me only two days since, the article of Professor Chitti on " Paper Money and Money of Paper," and if you will permit me, I will avail myself of your Magazine to emit an idea which has occurred to me after the perusal of said article. (Being only thirty months in the United States, I have to apologize for the deficiency of my knowledge of the English language.) Here, in Iowa, we suffer more, perhaps, than in other States from a want of currency. We are in the midst of riches we cannot bring to account. land Suppose, now, the State of Iowa creates a paper currency and furnishes every owner, settled on his land,* who wishes it, on every acre of open prairy $1, on broken prairy $3, on broken and fenced prairy $5, and on timber $3,† at the rate of 6 per cent interest. This, I believe, would soon bring amongst our population a sum of pretty large amount. It would be solid currency, because the State would guaranty it, and be reciprocally secured by the mortgages on the lands. On the other hand, the State (having for that purpose an agent in all the incorporated towns, or, if thought advisable, in every county, or in every township of sufficient population) allows 5 per cent on all the State currency which is deposited by her primitive borrower, or any other person, with one of these agents. If the money is redemanded, said agent gives a certificate for the interest it has made whilst deposited, and with this certificate the land-owner pays part of his own interest. In case the person who deposits the currency is no land-holder he can pay his certificate to land-owners, or it may serve him in paying his State tax. The interest the State makes in that way, after deduction of the expense of the whole establishment, will make a large sum. This money will serve, 1st, for the State expenses, which now have to be collected by tax; 2d, as a reserve fund to encounter such losses, which, notwithstanding all precautions to the contrary, will occur by frauds or malversations; 3d, and the balance will be appropriated to internal improvements. This is the main idea. I will not work it out in the details for the moment. Let us see now how this system will work. The current interest is now with us, 10 per cent, and a great sum might be put out at that rate. But in future, farmers will hardly want any loan, for when they enter Congress-land they can get nearly the whole value back in State currency from the State; and every year they are entitled to an augmentation in exact proportion as they have added to the value of their land. In that way, according as the State is settled and more land brought into cultivation, the amount of currency increases. And for an over surplus there is no danger. All the currency which is not immediately wanted, is deposited with the State agent, or at the head establishment itself, and this acts as a safety-valve. The farmers, (land-owners,) being always provided with currency, can buy everything for cash, which will be to them an advantage of from 6 to 10 per cent, and, moreover, they can wait with the sale of their produce till the propitious time, which will prove at least an equal profit to them. The merchants who are compelled now to take a heavy per centage on their goods on account of the long time they are out of their money, and the losses arising from the credit system, will be content to make small profits with quick turns. Or every land-owner in general, this is a matter of after consideration. + As soon as the value of the lands will permit to do it safely, the State, if it be found proper, can end more. 1. e., The value of breaking and fencing. The jobbers and manufacturers, in their turn, will be equally benefited by their quick payments, and, as a matter of course, will be able to sell or produce at cheaper rates. In a word, it may be confidently expected that the whole credit system will be dispensed with. For now-a days, a farmer has credit because his lands offer security in the eyes of the merchant, but then that credit will have been changed in State currency, and when a man has squandered away the currency he got he is not worthy of credit. This goes all very well-it may be objected-as long as you remain in the State, but when country merchants in Iowa have to pay in St. Louis how will it go then? I must admit the fact, that if the trade of Iowa consisted exclusively in importing dry goods, groceries, hardware, &c., &c., from the East and South, to be paid in Iowa State Currency, that trade would soon be at an end. But let it be considered, that actually we make up the balance in our trade, 1st, by the hogs, the cattle, &c., (not to mention the produce of our lead mines,) we export; and, 2d, by the capital which the steadily increasing immigration brings in the State,—and that the system of State currency, founded on mortgage of land, will not have worked two years, before the hogs, cattle, and sheep, the horses and mules of our farmers will have increased to a large amount, so that the surplus of these, joined to the surplus of agricultural and mining produce, will largely cover the amount of our imports. I do not think this assertion will be gainsayed by a single man who is acquainted with the rich soil of Iowa, and who observes the tide of immigration coming in. Consequently we may expect that for every dollar of Iowa State Currency which goes to other States, there will be a demand in those same States for more than a dollar from the side of the merchants who have to pay our produce, or from the side of those who intend to settle in our State. I might stop here, but I hear a question. Will not the the Board of Directors of the State Currency be able to engross all the gold and silver currency which is in the State? The answer is, No! Every land-owner is admissible at any time to redeem his mortgage, but only in State currency; and if we are to see the time that he can get money cheaper than 6 per cent, then the State will be able to lower her interest accordingly. As soon as the system is brought in working, and works well, the State will admit the payment of taxes in her own currency; and it may be supposed that even county and town taxes will be accepted in the same, as the amount collected can immediately produce interest as long as they are not expended. My intention is to bring this idea before the Legislature of Iowa at their next session. In the meantime, I would be happy to make it public through your widely spread Magazine, to see whether it can stand the test of publicity. I remain, Dear sir, yours, respectfully, A. E. DUDOK BOUSQUET. P. S.-The more I think on this plan the more I see in it. Those State agents will be the cashiers or bankers between all the merchants, manufacturers, &c., in their town, yea, by and by every one will deposit his currency with him, and so his office will turn out to be the savings bank of the whole community. This will create an immense deal of writing and transferring, but every man will be ready to pay a small per centage for that; and that small per centage will make at once an agency to be a highly remunerated office. My idea, therefore, about these State agents is this :—That they ought to be chosen from amongst the most respectable and intelligent men, but subjected to a bond of large amount. They ought to be nominated for life. This will give the best guaranty for the faithful and active fulfillment of their office. On the other hand, at the first fraud or malversation, they ought to leave their office and be severely punished by detention in the penitentiary. If necessary, a special law is to be enacted to that effect. The proposed system of currency will be the source of greater advantages to society than I am aware of myself actually. One of these is, that the remotest counties will be as much benefited by it as the largest towns. The currency comes, so to say, out of the soil, and it is the farmers-the basis of the social pyramid-who, the first of all, will reap those benefits. I just mentioned, en passant, the savings banks. I remember that some of those established in Holland had to stop payment at a time of a considerable fall in the State funds, which had, however, been considered as the safest investment for them. And with the facility of making 5 per cent interest on it as soon as he does not want it. + This will of course diminish, forasmuch, the profits of the State, but the railroads will not be built the later for that. The State currency furnishes to every member of the community a kind of fund which is not liable to any decrease in value. One heavy objection remains. Suppose the office of the State agent in a large city burned out, with all the books and the State currency it contained. Would that not occasion the greatest confusion throughout-the greatest loss for the whole community? Certainly! But I trust the advantages of the plan are such, that we should exercise all our ingenuity to overcome that danger. The buildings might be constructed of strong masonry-provided with a good vault-warmed by steam, and lighted by the safest of the latest inventions. The paper might, by alum or otherwise, be made incombustible, and, moreover, the eyes of the whole population would be open over it it as their common treasury-as the heart of their social body. I hope this will not be an unconquerable objection. DEBT AND FINANCES OF VIRGINIA, SEPTEMBER 30, 1851. A. E. D. B. CERTIFICATES AND BONDS ISSUED AND HELD BY OTHER THAN STATE AGENTS. For internal improvements (of which $860,000 coupon bonds)... ...... Total.... $10,630,346 450,107 $11,080,453 Exclusive of the above, there is held by the literary fund.. $1,132,606 378,913 Total.... $1,511,519 The actual subscriptions and appropriations on State account to works of internal improvement, which have become obligatory on the State, and for which loans are authorized by law, amount to $5,058,130 This may be further increased by additional subscriptions authorized by law, to joint-stock companies, for internal improvements...... $1,000,080 (The periods of redemption of $9,035,189 of the above debt are as stated in the Merchants' Magazine for January, 1851, page 103, and of the debt since created in the years 1875, 1876, and 1886.) |