The aristocratic European fancies the whole parish dependent on him for subsistence, while in reality no individual in the community could be more easily or cheerfully spared. Abroad, he accuses the whole world of living upon him, without stopping to consider that he pays for nothing which he does not receive. In the same spirit the wealthy Southerner despises the Northern adventurer, who comes to do for him what he cannot or will not do for himself, and grudges the Northern merchant or manufacturer the fair recompense of his capital, labor, and skill. His fields, it is true, with the aid of his slaves, produce cotton, but he cannot eat cotton, drink cotton, nor even wear cotton, till Northern skill has made it into cloth. He cannot compress it into bales till Northern hemp has furnished bagging and rope. Being generally in debt, he cannot get along without advances of Northern capital, even before his crop is brought to market. He cannot manufacture it at home, and he has no ships to send it abroad; he must, therefore, transfer it to the Northern merchant and manufacturer before it can have a market value. Now as his cotton without these operations is worthless, it is not only just that those who perform them should be remunerated, but it is evident that they confer wealth on him, at least as much as he does on them. If there is any favor in the case, it is bestowed by those who do for him what he cannot do for himself. The whole frame-work of society is made up of mutual services, mutually recompensed; and it is preposterous in the extreme to imagine that it is more honorable to pay for a service rendered than to render a service for pay. "The laborer is worthy of his hire." If the South continues poor while the North has been rapidly growing rich, it is not because the latter has not paid in money, in food, in clothing, or otherwise, the full equivalent of all the Southern cotton it has bought, nor that Northern ships have been paid more than other ships for carrying it, nor that Northern merchants and bankers have been able to charge higher commissions than others. There has been no monopoly of this kind forced upon the South:

"The world was all before them where to choose."

The whole secret of Northern wealth and Southern poverty lies in one little word-labor. Where labor is honored and diligently pursued, there must be wealth and prosperity; where it is despised and disregarded, poverty will be the rule and wealth the exception.

These views are fully illustrated by the financial history of the North, during the present war. At the first outbreak of secession, the sensitive nerves of commerce vibrated with alarm. The first impulse of Northern merchants was to lay in heavy stocks of cotton; the first impulse of too many Southern merchants was to refuse payment of their debts due at the North. The cotton crop was hurried forward with unusual rapidity, and sold promptly for cash at unusually high prices, while large amounts due from the South remained unpaid. The natural effect of all this was to create for the moment a heavy balance of payments against the North, leading to great scarcity of money, distrust, curtailment of credit, and almost a monetary crisis. With admirable sagacity and good judg ment, the New York banks, appreciating the temporary nature of the emergency, threw themselves into the breach, and by judicious and liberal loans averted the impending danger. In a few weeks the difficulty was at an end, and money as abun dant as ever. Those merchants who depended for their solvency on Southern remittances, were in many cases ruined by the practical repudiation of their debtors; but the community stood firm, and ultimately a large part of the loss sustained was probably made up by the increased value of cotton and other Southern produce which had passed into the hands of Northern merchants. The utter fallacy of Southern predictions was now demonstrated. Banks and bankers, merchants and capitalists, consumers and producers remained, with few exceptions, in much the same position as before. Capital and labor, it is true, became somewhat deranged by non-intercourse with the South, but as the change was necessarily gradual, they learned by degrees to find new channels for their activity. The country continued to produce an ample supply of food and other necessaries for its population; and whether a portion of that population were engaged in ministering to the wants of

the South or in fighting against it, the country was able to feed and clothe them as before.

Simple and natural as this result may appear to us, it was doubtless unintelligible and unexpected to Southerners generally. A local aristocracy, monopolizing the land and wealth of its own community, cannot easily be made to understand its own insignificance in comparison with the vast resources of intelligent and organized labor, in a population free from the incubus of caste and privilege. At the South, the mass of the people have little to spare beyond a bare subsistence, and all extraordinary burdens must be borne by the few wealthy. At the North, the wealth of the few is as nothing to the enormous aggregate of moderate accumulations made by the mass of the laboring population. It is true that vast numbers of this population are employed in transporting, manufacturing, and distributing the cotton, from which so large a part of the clothing of the people is made. But it is equally true that the people will be clothed, whether they have cotton or not. Whatever its material, wool, hemp, flax, or jute, it will be provided, and those who provide it will live by it, as they formerly did by

cotton.

Had this been all, our troubles would have been light indeed. But in addition to this temporary derangement of capital and industry, came the dire necessity of waging war on a colossal scale. An enormous navy had to be extemporized for the blockade of many hundred miles of coast, as well as for aggressive expeditions. Six or seven hundred thousand men, not poor peasantry accustomed to privation, but well-to-do citizens demanding high pay, good clothing and comfortable care, had to be sent into the field, and equipped on the most lavish scale, with all the appliances of modern warfare. All this required an immense expenditure, and the funds must be furnished by taxation upon a people, few of whom had ever known what federal taxation was, or by loans negotiated in a community, nearly every man of which was habitually in debt!

During the early stages of the rebellion it was confidently expected, we presume, by most at the North, where the loyal spirit of the country was so signally developed, that the cordial

sympathy of the mother country would be bestowed upon our righteous cause. It was scarcely possible to conceive otherwise. "Governments derive their just powers from the consent of the governed;" but here was a government, lawfully chosen by a majority of the governed, defied and insulted by the very men whom the majority had repudiated, and who had solemnly sworn obedience to the law. The revolution of 1776 was an uprising of the people against a tyrannical government; the rebellion of 1861 was a conspiracy of a tyrannical ruling class against the liberties of the people. The revolution of 1776 was a vindication of liberty and equality for all classes; the rebellion of 1861 was the assertion of the privilege of caste and of the perpetuity of human bondage. The revolution of 1776 was directed and completed by the wisest and best men of the nation; the rebellion of 1861 was devised and carried out by the most profligate politicians of the country. The former called forth a spirit and developed characters which form the brightest ornament of human history; the latter has elicited displays of fraud, falsehood, and violence, worthy of savages or demons. But all this availed nothing to turn the current of English sympathy in a direction which might run counter to the demands of English interests, real or supposed. For many years British ship-owners had cast longing eyes upon the vast coasting trade of the Western continent, from which their vessels were excluded; and British free-traders had chafed at the still remaining barriers, by which American manufacturers were protected. The ruling classes of Great Britain might also naturally fear the ultimate influence of a vast and successful democratic power in the politics of Europe. The division of the United States into two great rival and hostile confederacies would seem to favor all these ungenerous aspirations. The South being notoriously destitute of ships and sailors, its commerce would naturally fall into the hands of its largest customer, Great Britain. Having no manufactures of its own, it would naturally seek to exchange its raw produce for foreign manufactures, with the most perfect freedom of trade. And, finally, its native rivalry and long cherished hatred of the

North, would lead to an antagonism which would effectually preclude all future danger to Europe from either party.

Plausible as all this may seem, we may safely assert that selfishness has never more completely outwitted itself. For nations, as for individuals, "honesty is the best policy." These blind advocates of Southern independence forgot, that while they sought to secure a monopoly of trade with communities too poor and uncivilized to be profitable customers, they must of necessity alienate and build up in commercial independence other communities of double their population and many times their producing and consuming power. And though for a time the two rival powers they sought to establish might prey upon each other, and let Europe alone, the time would doubtless come, when, having composed their feuds, and each having developed its military and naval power to the utmost, they would unite to give law to Europe and to the world.

In the meantime, however, having become imbued with these views, the wealthy classes of Great Britain naturally refrained from lending money to prevent a result, which they regarded as desirable for English interests, and did their utmost to discredit the United States government in the money markets of Europe. Their leading journals triumphantly and scoffingly announced that no English money would ever be loaned to carry on this "unholy war," and even went into elaborate calculations to demonstrate the utter inability of the loyal States to prosecute the contest they had so rashly and so wickedly undertaken!

What was the Secretary of the Treasury to do? At the very outset of his career he had committed, as we think, a very serious, though not unnatural mistake, by refusing a large part of the proposals for which he himself had advertised, in the first loan negotiated after his accession to office. It is doubtless unpleasant to accept 92 per cent. for bonds which had recently commanded 120; but credit, like water, will find its level, and no effort or contrivance will long avail to prevent it. On the other hand, to refuse offers made in good faith, and when no higher offers could be obtained, could not fail to check the disposition of capitalists to make any offers at all. It was rumored