Our American Letter.

Otago Witness, Issue 1422, 22 February 1879, Page 19

Our American Letter.

(from our own correspondent.)

San Francisco. January 20th.

The holidays have passed vith the vuraal festivities and g liety. Americans take more real erjoyment mit of Ch'istmaa and New Ye*r than almopt any oth^r people, acd voting and oH appear to forget everything but present haprriness. It; is well it should; be so, baoaupe th^re are carea enow during the balance of the ye%r, and 1878 bpyon* ' question has been a season of great tribulation. It clo^'d gloo-nily all over the world, except, perhaps, your own highly-favoured islands, where everything ar»Dears to ba prosperous. Not so in the United St«tes» desDite th« annual menage from President Hayes and the no^ea of satisfaction by leading newspapers. The truth is, thit grinding 1 poverty '« at; tbe door of a 'argw prop Mrtion oi onr popuMion, town and co'infry, than elsewhere, although Englani and Scotland are unhappily t gbtly pressed iust how. What enables us to keep ahead at all ia the vast undeveloped regioDS west of the Mississippi, and tbe practically limitless resources of tha Southern and Mi-Idle States. <">n a c*refal re^ipw of tbe outlook of this country, leaving tbe Pacific and territories our, I am natianVd that Virginia the Carolmas, Rift Louisiana not to mention. Texas, offer greater i'ducementa to men of moderate m a anß than, any other section of the Union. Pennsylvania, as a mineral - producing country, ifi unsurpassed in ihe world, arul will lead in th« production of iron, an* machinery at no distant date. Pa ooal dppoaits are larger and equally accessible as* those of Great Britain ; its iron is of betterquality, and cloaeto the coal ; and italaftoax,, by reason of combination and monopoly of capital, bicfcel by cUsa legislation, h lews independent, and rel .tively worao paid than similar labour in EngUud. On this point, however, I need n»t *nl*rge, as I treated tfe fully in a former Mter reviewing the secial condition of the Sta*;* 8 affected by tha greifcr Übour revolt of 1877 Suffice it that, on the whol», th*> condition of labour has nofc materially improved since then 1579 op^ni with more promise, although: the excessive severity of the winter inteiN feres with all oat door operations, and several of the largest, cotton factories are running; | half-time to reduce production and harde» priors. St-ikes ar« likewise in progress in the efial region. The Pacific Slope has been singnHviy free from climatic disturbance, or aayth ; 'i£ calculated to retard development, cave and except Chinese competition, whidt has now reached the stage of absorptions The extent to vhicU ihia evil has reaohei-

Measured by the fact that during the past v jear the population of California increased only 9000 odd by immigration from all points, the bulk being Chinese. Yet we have a \ jzrand State, unsurpassed iv every element > of wealth and progress by any similar territory of equal extent in the world. Geographica'ly we are the very central point of the world's commerce ; industrially we pro-

cluce an enormous surplus, are large ex.porters of breadstuffs, wine, gold and silver, trait— canned and fresh ; fish— pickled and j*annedj our paper and woollen mills turn ,out large quantities of paper and woollen 'fabrics, our foundries and machine- Rhops are al spays busy for Home and South American demand ; we grow and manufacture sugjr from beet, and have large sugar refineries ; we make glassware, willow-ware, matches, and watches— the American Watch and Clock

Co. b.-iog a San Francisco institution. In short, save in articles of luxury, we are far more than self-supporting ; yet we are steadily retrograding. Money is growing ■scarcer ; labour is worse paid, and the hours of toil are growing longer. Merchants are beginning to feel the pinch of the times, and jjhe present year will witness many changes in old established firms. The people have less money to spend, and trade ia dull. The reason why is not far to seek. The Chinese, by means of organised al^velabour, have frozen out free American

labour, and now that the displacement is

■complete they command the wages fund, withdraw it steadily from circulation, and through their companies send it to China for investment thtre, whence it never returns. All the while Americans are compelled to maintain the institutions of Government; support schools* churches, hospitals, &c, to none of which do the Chinese contribute anything. This is the cause of our stagnation ; this is the reason why we have famine in the midst of plenty ; this is why'a country more abundantly blessed by Providence than any other, lags bebind in

the march of development, and contains within her bosom elements of revolution and disturbance which may disrupt the Union. .The Chinese question is attracting attentioE in Washington, where the House Committee on Education and Labour has reported a bill to Congress forbidding any ship to carry more than 15 Chinese passengers to any American port. Accompanying the bill is an exhaustive report, reviewing the whole question in its social, moral, and economic bearings. It describes the Chinese upon this Continent, from sworn testimony, most truthfully, as " sordid, selfish, immoral, and

non- assimilating, and a standing menace to "the social and political institutions of the Toountry." Considering the probable outcome of existing conditions upon this coast, the report says : — "The Mongolian, like the Indian, is brought in daily contact with our social and political life, and, unlike the

African, does not surrender any of his marked peculiarities by reason of the con■tact. It ia neither possible nor desirable for 4wo races as distinct as the Caucasian and Mongolian to live under the same Government without assimilation. The degradation or slavery of the one or the other would he the inevitable result. Homogeneity of ideas and of physical and social habits are «sssntial to national harmony and progress." This point is well taken, and in view of the gradual growth of a Chinese question with; you, ifc should be borne in mind. It is the deliberate judgment of a select committee of

American gentlemen, none of whom have any direct contact with the Chinese, but who take an impartial view of the whole case. In the same judicial spirit is the fol« lowing from the same report :—" Equally grave objections may be urged against the Chinese irom an industrial standpoint. Oar labouring people cannot and must not be subjected to a competition which involves the surrender of the sacred and elevating influences of home and the sacrifice of the ordinary appliances of peaceful civilisation. The question, therefore, is not one of competition, but the substitution of one kind of labour for another. No self-governing country can afford to diminish or destroy the dignity, welfare, and independence of its citizens." This affirms a principle too often lost sight of, namely, that the highest conditions of human existence are not those which build up an oligarchy of rich men by ike degradation of the majority of toilers. It would seem, however, to judge by economists and plutocratric writers, as if civil government was instituted for the sole purpose of bringing about conditions whereby r few men may amass and hoard great wealth out of the enforced labour of the masses. I say " enforced labour," because a man without inherited or acquired wealth. has no more alternative in the matter of

labour, ab such rates as organised capital can

fix, than the African slave had under the *' peculiar institution." Vagrancy laws and the criminal code settle the business. He is the slave of organised society without legal ■claim upon his master. Now, in European ■countries this social iniquity is designated by the high-sounding title of " supply and demand," and so it was here until the Chinese came, and it becatre in a few years ""snpply and no demand." Chinese coolie competition in the fields and workshops and

.households; of. California has brought the ghastliness of this economic spectre into full light, and Congress is called upon either to Abate the evil or face revolution. The Con-

-stitutional Convention of California — the people in their sovereign capacity — has memorialised Congre3S on the subject, and should Chinese gold corrupt the national legislature, as ife is expected will happen, flic .fire of rebellion will be lighted upon this (Coast. These views may appear to be radical in the extreme to you. But they are not radical. They are forced upon me by the inexorable logic of facts. I know the same

uauses are in operation in Otago, as they are In all British communities, without conscious thsign perhaps, but nevertheless real and menacing, and it is to warn your public men -and tbo^e influencing public opinion that I write in this way. Get rid of the Chinese. SYeeza them out, or they will corrupt your - .social system, ' demoralise the body politic, aad end by subverting your institutions, for there is no more aggressive race than the Chinese .when they have the power. Let there always bs a safety-valve for your people in the shape of cheap land. I question the policy of a Government selling land to bonarfide settlers at speculatively high .rates/ This course puts it out of the power

of poor men to acquire freeholds, and lends to the growth of a proletariat, which cannot exist in any country governed by democratic institutions without ever-present danger of turbulence.

Resumption of specie pajment made no peiceptible charge in the current of affairs Tne Treasury Department had 226,000,000 dol in sold and silver to " resume" wiih, but only 140 000,000 was available for redemption of United States notes. This sum would havo been wholly inadequate had there been a run on the Treasury, but people generally preferred paper to coin when it stood at par. It is worth reviewing the grots results of the financial policy sinne 1866. The national debt has been reduced by 740,000 000 dol ; 520.000,000 dol of the interest- bearing; debt has been paid, and the average rate of interest reduced from 6.1 to to 4.5 per cent. The annual interest account, which stood in 1866 at 148,000,000 dol, now stands at 96,000,000 dol. The September Treasury statement showed that the public debt per capita in 1578 was 41 dol 67 cents, or £8 6s lOd, against 78 dol 25 cents in 1865. This is a very remarkable showing, but it his been brought about in the most unscientific way, bearing unnecessarily hard upon industries of all kinds, and in largely responsible for the widespread poverty and destitution of the country. It the first place it crowded the whole costs of the civil war upon the present generation without giving it time to recover from the vast industrial disturbance caus°d by the war. To this end it contracted the currency, thus virtually handing over the country to speculators, usurer?, and money-brokers. Debts accumulated, interest remained unpaid, realty depreciated in value. Only Wall street and the gold ring nourished. While this happened, the silver dollar was dropped out of the list of legal coins, and silver was demonatised by a trick. Bat this was not all. The United States paid interest upon its own bonds, deposited iv lieu of notes issued for circulation by the national banks, and, as has berni shown, 140,000,000' d0l in gold was hoarded under the redemption law, still further contracting the circulating medium, and indirectly taxing the public 6 per ceDt upon tha* amount. While, there fore, resumption has been accomplished, it has been by sacrifice's wholly unnecessary under a sound system of finance. Still, the end has been reached, and gold, silver, greenbacks, and national bank notes are interconvertible and interchangeable. And that ia resumption. I rememb"r reading Fomewhere in the annals of Old New Zealand how a distinguished representative of the Islanders went to London, and, looking at St. Paul's and Westminster Abb'-y as milestones in an effete civilisation, performed a very remarkable financial feat. He consolidated the outstanding securities of the New Zea landers, funded the public debt, and raised the credit; of the Britain of the South by increasing its liabilities. This was a stroke of genius but little appreciated at the time, although it served as a precedent for future financial operations, until now communities when taking atock usually treat their public debt a« an asset. I don't know just how ifc is in the contemporary history of your country, but I observe that New South Wales and Victoria prepare tbeir annual balances upon this admirable principle. We owe so much, however, in the United States that consolidation would be impossible. The national debt I have treated of ; but municipal debts, to say nothing of State debts, would aggregate so much that I fear I could not write down the amount correctly. Brooklyn, for example, the City of Churche?, owes over five millions steiling, and this i 8 a bagatelle to other cities. San Francisco is the least burdened with debt of any large city in the Union. The interest on the city debt of New York this year ia about £1,750,000, and the estimate of expenditure fo» the city government for 1879 is over six million pounds sterling. New York has had rarii development, but not more so than Chicago which is so mortgaged and overlaid with debt that the people quote the figures with pride as a proof of their supreme happiness and unparalleled prosperity. But Chicago is really a very prosperous centre. Its trade last year was enormous. The value of produce received was 219.700,000 dol, being a large increase over 1877. The bulk of this enormous trade was shipped eastward for export, the free traffic on the canals enabling produce to be sent to the Atlantic seaboard at a very low rate. The receipts of breadstuffs at Chicago last year footed up 134 856, 193 bushels. Over 25 million bushels wheat were exported. Hogs valued at 44,810,000 dol were received at Chicago last year, and 5,128,000 hogs were killed for packing. I This will give you some idea of the money there is in the pork-packing business, about which I wrote in a former letter. Reviewing the, whole operations of trade and manufactures in Chicago during 1878, the result is shown in an increase in coin value over 1877, of 55,000,000 dol, although the capital invested had not increased, and the average decline in prices was 17 per cent, on the year. Reverting for a moment to the public debt of the United States, a very important financial operation is in progress. When Secretary Sherman acid 50,000,000 dol 44 per cent, bonds to obtain money for resumption, the idea was broached that a 4 per cent, loan would be popular in this country if issued in small denominations, as a safe means of investing savings, the Savings Banks generally having burst, sweeping away the accumulations of the working classes and farmers. The idea once broached was acted upon, and the result has been most gratifying. One day this year the subscription to the 4 per cenc. loan was over eleven million dollars ; and in the first five working days of the year the Secretary of the Treasury sold twentyeight million dollars of 4 per cent, bonds. This fact is unprecedented in the history of funding operations. Up to December 31st he had exchanged 124,000,000 dol 4 per centa. for 6 per cent, bonds, saving 2,500,000 dols a year interest. In the near future still larger savings will be made, because the National Banks, whioh have 6 per cent, i bonds with the Treasury to secure circulation, are withdrawing them for sale before the premium drops off, and replacing them by 4 per cents. This exchange, which has commenced for the series of 1867, will cause a demand of from fifty to one hundred

million dollars' worth of 4 per cent, the present year. The success of this popular loan indicates that at no distant date the United States will be a creditor country, just as England is — that is, its public debt will be held by its own citizens ; and as it is the granary of the world, and its manufactures are superseding those of England abroad, it follows that all its bonds in foreign hands will be returned in payment of its produce and goods. This is a consummation devoutly to be wished. It is, however, not so far distant as to be in the region of purely speculative finance. If Congres3 enacts the bill introduced by Senator Booth, of California, making subsidiary silver coinage convertible into currency at par in sums of 20 dol and upwards, the country will be better able to bear the present strain. Wages are invariably paid in subsidiary silver, which is only legal tender for 5 dol., and is 10 per cent, less in weight than the silver dollar. Hence tradesmen and labourers must pay moneybrokers a heavy premium to change it into gold or grembacks, in which rents, taxes, &c. must be paid. I think it will pass, and the scaling of coins as a business cease.

The Protec'ive tariff and Shipping Registry law have jointly driven the American flag off the high seas. The Central Pacific Railroad proprietors, however, have done their best to offset this by establishing the O. and O. line of steamers between this port and Japan and China, These steamers, owned here, are under the British flag, and .are comm.inied and officered by Englishmen. "But they are practically an American line, and have nearly driven the Pacific Mail Company off the route. William Vanderbilt;, of New York, has adopted the same plan, only on a much larger basis. Having secured control of all avenues of traffic into New York from the West, he has set about controlling all shipments of produce and merchandise to Europe, which is now divided between New York, Philadelphia, Boston, and Baltimore. The latter city is fast rising into prominence, and will be less affected by the Vanderbilt carrying scheme than the others. The plan is as feasible as it is gigantic, and as an example of modem American business methods is eminently instructive. The Btory is thus told in the New York World, and is well worth reprinting :«•> "A HEW DEPARTURE IN OCEAN FREIGHTS.

"Mr Vanderbilt has made a commercial advance which is gigantic even in its present proportions, and which promises to be revolutionary in its future progress, The carrying trade between tbe United States and other countries has passed almost exclusively into the hands of foreign vessel- owners. The bulk and the value of American exports have been increasing annually for a_ number of years. So large and so profitable has been the carrying business that steamers have repeatedly arrived in this country in ballast, or with little freight, depending on taking back a cargo profitable enough to pay for both ways. The merchants of the United States have vainly appealed to Congress for years to so change the revenue and navigation laws that American steamers might be built in this country for the foreign trade, or that Ameiican merchants might be permitted to purchase foreign-built vessels, and have them registered as American steamers.

" Vanderbilt has settled the question to a large extent. The companies he represents have built a number of elevators in New York, so located that steamers may run alongside and take in cargoes of grain at little expense for handling, and relieved of all the scandalous and excessive charges which have prevailed so long in New York Harbour. He has secured in Europe no less than 14 screw-steamships of 2000 tons eaoh, to run in connection with the New York. Central Railroad and its branches, to carry freight exclusively. These steamers are to rnn between New York and Liverpool, Havre, Hamburg, Antwerp, and wherever else there may be business offered. These 14 steamers are but tho beginning. The number can be increased indefinitely as the business may demand. To all practical intenta and purposes, they will be American vessels, owned and controlled by American citizens, carrying American exports, aad generally engaged in the American trade. But, under our law, they will not carry the American flag, nor will they have American papers. '• This line of steamers will be exclusively for carrying merchandise. One of them will leave New York every two or three days, and every steamer will be furnished any deficiency in a full load from the grain elevators of the Vanderbilt railroad lines.

" This enterprise will enable the New York Central Railroad to command the entire transportation from the We6t intended for export. Shippers of breadstuffs and provisions in Chicago will be able to make contracts here with the Vanderbilt lines for transportation to Great Britain, France, Germany, or to the Dutch ports, with the same facility that they can contract from one domestic point to another. The transportation will be continuous, from the Western city to the steamer, and thence to the Euro pean destination. The contracts will be for through freights, including rail and steamer, or lake, rail, and ocean steamer. Provided with these facilities it is not unreasonable to expect that the Vanderbilt lines will be able to defy all competition in the matter of ship ments from the West for exportation. This large line of 14 steamers, capable of being increased indefinitely, will enable New York to command all the foreign trade in Western products which now finds its way to other Atlantic ports." I had intended writing of social affairs, but the requirements of your space will not permit. You must justdraw somewhat upon your imagination, and picture the very best and the very worst yuu cm. Where this has been done you will have about the measure of American society during the past month. Murders and suicides have been of frequent occurrence. The law is beginning to lay its hand upon criminals, and bank swindlers are finding their way gradually into prison East. Here we feast and pet them, appropriate suites of rooms to their use, permit them to go out and dine with their families at fashionable restaurants, find them attenl> danta in iheir drives to Cliff House. Should they chance to get across the Bay to San Quentin they soon manage to run the State prison, offer the hospitalities of the place to visitors, have their stock brokers and agents,

and attend socials and pleasant family gatherings in the neighbouring towns, sometimes even taking a run to the Capital. But somehow it is becoming very unpleasant for them since the working men's party was formed, the delinquencies of officials being ventilated every Sunday at the Sand Lot, and reported in the newspapers. Public opinion is forming which will draw the halter tight around the neck of thieves. And speaking of halters, Trog Dye, public trustee of Sacramento County, who sent out "killers" to increase his official fees, has been found guilty of murder in the first degree ; and Hunter, the New Jersey merchant, millionaire, and pietist, who murdered a man to get 26,000 dol. insurance policy, has been hanged. A little more hanging would have a salutary effect.

Jacob Terry. P.S. — The detention of the steamer, ovviug to the non-arrival of the mail through long passage across the Atlantic, enables me to send a few lines additional by way of postscript. Oiago readers will regret the death of their old friend and acquaintance, Mr Duncan, which took place at his son-in-law's residence, Fruit Vale, Oakland, a few days ago. He was justly esteemed here. Mr Duncan had been in very bad health for some months past. The Australia takes a full cargo, chiefly barley. Among the passengers are Miss Dargon, the celebrated actress, and her agent. She goes on to Australia. Mr Warwick

( Weaton, inspector of the N. Z. Insurance I Company, also returns, after visiting all the

company's agencies on this Coast and British

Columbia. The insurance business is a paying one in America, there are so many kme ducks of companies. When heavy demands

come upon a company of home manufacture it usually collapses, and the insurer has no remedy in fact, although his remedy at law is undoubted. Two sailing vessels are on the berth for Australia, loading with lumber and grain. The lumber business is rather sick just now, with a limited demand at lower prices. You will perceive from English newspapers the great success of the Anglo Californian presentation to Earl Beaconsfield. Sir Julius Vogel was present as representative of the British Colonies. The presentation was made by W. G. Harrison, formerly of Auckland, and the whole affair may be said to have originated with, and been carried out in detail by, "Old New Zealanders."

An interesting experiment in acclimatisation is being made by Mr Robt. J. Creighton, who has shipped 22 prairie chicken, from Kansas, to the Canterbury Acclimatisation Society. This is the first time prairie chicken was brought alive here, and should they reach New Zealand safely it will be a great feat. Naturalists on this side take a deep interest in the experiment. I hope it may succeed. Jacob Terry.