On these stocks were issued debenture In a former number, we mentioned 1833-4, the Bank of England design- 66 To aid in this, the Bank of England made money very plenty and The consequence was, very cheap. that the people of all countries went to England to borrow its cheap money; among others, the late National Bank borrowed £1,200,000, or $5,700,000, to aid in settling up its affairs." This facility of getting money from England tempted states, corporations, companies and individuals into borrowing, the late National Bank being the instrument of credit through which borrowed money poured into all sections of the country. When the inevitable ruin at length came, the States were left with gigantic works halffinished, and the means on which they had been taught to depend for the completion of them, cut off. In this state of things, the moral obligation of the debt and its fulfilment belongs as well to the tempters as the tempted; and, therefore, the States, in making offers of compromise to the best of their ability, have a right to expect that they will be favorably received. The general state of business is such as has generally been looked forward A steadily increased demand and to. improving prices are apparent in the leading branches of business. This, apparently, is a reaction from the great stagnation of trade and the ruinously low prices which resulted from the great and sudden reversion from the 20 per cent. tariff of the compromise act, which expired on the 30th of June, last year, to a tariff more prohibitive in its operations than even the famous enactment of 1828. There has not for years, probably since the war, been a a less amount of business transacted in the port of New York than during the eight months commencing July 1, 1842, and ending March 1, 1843. Since the last-mentioned period, the absolute wants of the community have induced a greater demand for goods, the stocks of which were reduced by exports for benefit of debenture and by limited imports. The consequence has been, that all the late sales of hardware, dry goods, groceries, &c., show an improvement in prices of from 10 to 15 an per cent. over the lowest points of depression last spring. Assortments of goods have become broken, and imports to make them good have increased to extent which affords homewardbound packets freights nearly double in value to those that they procured through the corresponding months of last year. Still the imports are by no means large. The revenue of the port of New York, for the month of July, was about $1,100,000, which, according to the usual proportion of twothirds, gives a customs revenue of $1,650,000 for the whole Union for the month, and shows a large increase over that of the same period of last year. The foreign exchanges show, however, a balance still in favor of the United States, although nearly at par. They have not advanced materially since the quotations in our June number, with the exception of France, on which point they have risen to f.5,26, and some small amounts of the best Mexican dollars have been shipped. The general import of specie, however, continues larger than the export. The basis on which trade is conducted throughout the Union now, is such, that no large and sudden demands for specie can take place. No large banking or mercantile credits are now outstanding. Capital, for the most part, is in the hands of its proper owners, and cannot be extracted thence without an equivalent. The immense amount of specie lying idle in the Atlantic Banks, as compared with last year, notwithstanding the increase in the business of the country, is proof that a far larger amount of trade is now conducted without the intervention of bank facilities than formerly, and that the goods purchased are actually paid for, showing a great increase in real prosperity as distinguished from that precarious business which, under a National Bank, depended for its continuance upon the nod of a dozen men in Threadneedle-street. The banks of the Atlantic cities are both able and eager to extend their mercantile advances, in order to sustain their accustomed dividends; but, happily for the country, the great machinery which gave vent and activity to those advances is, for the most part, destroyed through the effect of its own corruptions. Under the late National Bank, when smaller institutions were multiplied in all sections of the country, a system of both buying and selling goods on long credits grew up. The interior banks gave facilities to innumerable traders to purchase goods at six and twelve months, and enabled them, in their turn, to give credit to consumers. The goods thus bought and sold were, for the most part, in excess of what the people would have been able to buy if confined to the actual profits of their own industry. The vent thus fictitiously created for imported goods, generated an increased demand from the importers upon the Atlantic banks for facilities. Every extension of the latter, therefore, tended directly to swell the imports, and immense credits were built up dependent entirely upon the strength of the interior banks. The more they pushed their loans, the more the demand grew upon those of the Atlantic cities, and the stability of the whole depended upon the amount of specie in the latter. All this has now changed. In Florida, Arkansas, Alabama, Mississippi, Michigan and Illinois, there are now comparatively no banks, where, in January, 1840, with a population of 1,777,000 there were $89,672,000 of bank loans, or over $52 per head. In other leading States, where banks are still in operation, an immense reduction in loans has taken place. This reduction is apparent inthe following table of bank loans in five States, from 1835 down to July, 1843.. These loans represent the artificial aid given to the people to enable them to buy and consume goods beyond their present. means of paying for them, as follow: 68,300,486 15,596,776 18,347,002 49,138,700 68,057,067 June, 1840 11,896,572 Jan., 1841 9,878,328 48,646,799 69,780,230 Jan., 1842 11,477,466 15,925,088 6,855,212 54,710,899 56,388,685 June, 1842 6,376,950 14,258,306 7,476,146 46,891,482 53,245,160 Jan., 1843 3,892,533 12,648,609 6,585,045 34,628,623 52,348,467 Aug., 1843 4,053,952 12,698,804 6,170,910 31,695,439 58,593,081 The reduction is really much larger than even these figures indicate, because many of the institutions whose loans are here included, are about closing up their affairs. 1839 was a year of great imports, and the amount for the year was $162,092,132, being the largest amount ever imported in one year, with the exception of 1836. In January, 1839, it appears that the bank loans of the above five states were $174,065,043. The population was 6,134,994. The loans of the banks were therefore equal to about $29 per head. In January, 1843, the loans in the same states had been reduced to $110,103,277-a diminution of $64,000,000, or over $10 per head. The imports in 1842 had fallen to $99,357,329. This facility of selling goods on credit, through the instrumentality of bank loans, swells the imports inordinately, and counteracts the effect of any duties, how high soever they may be laid under the pretence of protection. The reduction in bank loans, for the whole Union, in 1842, was about $160,000,000, or about $9 per head. The imported goods consumed, in 1839, were equal to an average of $9.25 per head in the Union. In 1842, the consumption was only $4.50 per head, although the exports of American produce were larger in the latter than in the former year. The banks are now not in a condition to renew their The variety and value of these exports, under the present regulations of Great Britain, are rapidly increasing. The export of agricultural products to England is becoming important, and prices are on the rise. A late parliamentary document gives the following statement of the trade with the United States at three periods, to which we have added the average duties in the United States at each period, giving the equivalent ad valorem for specific duties: The United States return for 1842 has not yet been published. This table embraces the whole operation of the compromise tariff. In 1833, it was in full operation at the highest rates. In 1836, the second biennial reduction took place. In 1842, the last instalment was taken off; and from July 1st to September 1st, the 20 per cent. duty only was in operation. Now, in 1842, under the lowest duty, the amount of exports from England to this country was one-half that of 1833, the year of the highest duties, notwithstanding that financial embarrassment had reduced prices in England for 1842 very far below those of 1833. With low prices in England, and low duties here, onehalf the goods were sent to the United States that were exported under the high English prices and American duties for 1833. In the year 1836, the average duties on the above articles were 32.5 per cent., and the import was £12,425,000. In 1842, the average duties were 25.9 a 20 per cent., a reduction of 6 a 12 per cent. ; yet the import fell off to £3,528,000, or to about 25 per cent. of that of 1836. To what other agency can this enormous decrease of business be ascribed than to the diminution of bank loans? If, then, the imports were so seriously affected by the contraction of the banks in those years, an extensive increase of imports beyond the proceeds of the exports cannot reasonably be looked for under the actual liquidation of a large portion of those institutions, which before only curtailed their movements. Herein consists the great inconsistency and evident want of principle, which induces Whig politicians 322,486 334,678 to tax the people for the professed support and "protection" of a class of manufacturers, while at the same moment they seek the establishment of a national bank, the action of which would counteract the operation of the most extravagant tariff. The welfare of the whole people consists in unrestricted industry, and a sound and cheap currency, which will insure to that industry its just reward. The real "protection" of the American people will then be found where nature placed it, viz., in their unsurpassed enterprise, skill, and persevering industry. Under the violent fluctuation of trade exhibited in the above-enumerated facts, the finances, and nearly the credit, of the Federal Union, have been brought within the verge of ruin. The party lately in power is that which, since the formation of the Union, has ever been in favor of a splendid central government, with a preponderating executive power. This is only to be obtained by an enormous revenue. Now, the people of the United States, although prompt to expend their blood and treasure for the general welfare, will not submit to onerous direct taxes merely to support a government in an extravagance at war with the first principles of republicanism. The land revenues and the Federal customs afford ample means, with judicious management, to carry on the government vigorously and successfully, but will not allow republican officers to ape the splendor of the ministers of monarchy. It would be political death for any public man to propose taxes for such a purpose. Yet the same end is sought to be arrived at by indirection, that is, by a combi nation of the antagonist principles of a paper currency and national bank with a "protection to manufactures." With a specie and dear currency, an average of 30 per cent. duties is prohibitive, and ruins the revenue. With a national bank and an expansive paper currency, a duty of 50 per cent. would not check imports, because the prices rising pari passu with the paper inflation, induces imports, and swells the revenue to an extraordinary extent. Thus, in 1839, under the third reduction of the compromise tariff, the customs were $23,137,924; while in 1834, under the highest range of the tariff, the revenue was one-third less, or $16,214,957. By thus holding out a delusive idea of protection from high duties to one class, and the benefits of a national bank to another, the party desideratum of an immense federal revenue is sought to be attained. These two measures were the leading motives of the extra session, at which, as a preliminary step, duties were imposed, after September, 1841, upon all articles theretofore free. This was indeed necessary, in consequence of the declining imports consequent upon the approach to a specie currency. The national bank project was defeated. At the regular session, however, a tariff was imposed, which averaged for the first quarter after its adoption a duty of 35.38 per cent. on the value of the imports, which, however, gave but a revenue of $2,579,389 for the quarter. Had a national bank been in operation, with its facilities to importers, the amount of imports would have been equal, at least, to that of the same quarter of 1839, and would have given a revenue of $9,000,000, instead of $2,579,000, and would have furnished ample means to the party in power, how extravagant soever their views might have been. The important, and, to the party, vital measure of a national bank was, however, defeated, and the utter dissolution of the party has been the result, while the business of the country has suffered in a frightful manner from the sudden operation of an onerous tariff. In order to judge of the practical effects of the legislation of the 27th Congress upon the welfare of the country, we have compiled from various official reports the following table, showing the quarterly imports and accruing duties in the United States: QUARTERLY IMPORTS INTO THE UNITED STATES, WITH THE ACCRUING DUTIES. ALSO, THE YEARLY EXPORTS. |