CHAPTER II.

APRIL- -SEPTEMBER 1861.

THE history of the Cotton Famine naturally commences with the bloodless bombardment of Fort Sumter on the 13th of April, 1861. The event took the world by surprise. No one saw-certainly no warning voice of authority proclaimed, that this most courteous hostility, that this military performance was the overture to the most tragic opera yet placed upon the world's stage. Mr. Lincoln had been elected President on the 4th of March,on the 30th he had delivered his Inaugural Address-the first and last occasion upon which the chief magistrate of the United States is officially called upon to make a speech. His tone was eminently pacific-indeed, nothing less illogical than the argument of war could reconcile the present doings of the Abolitionist Generalissimo of the Federal armies with his inaugural utterance :—‘I 'have no purpose, directly or indirectly to interfere with 'the institution of Slavery in the States where it exists. 'I believe I have no lawful right to do so; and I have 'no inclination to do so.' We must confess in all humility that our purview was small indeed; we neither foresaw the toilsome strife which was about to dye the Central States with human blood, nor did we regard Abraham Lincoln as destined to become the most relentless enemy of the social curse of America. It never even occurred to us that he and his party were dissembling, in order to obtain complete possession of the Republic: and when the 13th of April arrived, and that sound was heard, so new, so startling to young America-when a hostile cannon-shot boomed across Charlestown harbour, even then

we persisted in believing that this interchange of iron compliments between General Beauregard and Major Anderson was nothing more than a game of brag.

There are many now, and their numbers will probably be increasing, who would gain a facile reputation for prophecy by the pretended prediction of accomplished facts. There are many whose most mournful recollection will be, that they could not foresee the signs of the times, and share that golden harvest which is ever the strange accompaniment of a modern famine. It is told of one of the kings of England, that he was never seen to smile after the drowning of his hopeful son, and the same perpetual gloom is said to overhang the visage of at least one manufacturer, who, in the temporary absence of his good genius, cancelled speculative transactions made in his name, which, being confirmed, would have raised him to the metallic rank of a millionaire. At this time, fortunes lay ready to the hands of investors; 'Middling Orleans'-the gauge of the cotton market-was selling after the fall of Sumter at 74d, per lb., which in December, eight months later, was worth a shilling. Where was then the capital of the cotton trade, and where that genius for money-making with which its constituents are not falsely credited?

The fact is, that the Cotton Famine-if this word still means scarcity-did not commence for a year after the period to which reference is now made. April 1861 was a time of gorged markets, both at home and abroad. The India and China markets had been overfed with manufactures until they threatened to burst with bankruptcy. The enormous demand of these new markets had so stimulated the home manufacture, that new mills had sprung up in every town and township in the cotton districts, and, with reckless cupidity, manufacturers had rushed to divide the profits of the increased trade. In the preceding year India had taken manufactures to the value of 17,000,000l., one third of the whole export; but merchants still piled the goods in the warehouses of Bombay, until ruin stared them in the face, and they began to realise the fact that these commodities had become an unmarketable burden. One of the wisest heads in Lancashire had forewarned them of this. Twelve months had

passed since they had been told from the chair of the Manchester Chamber of Commerce, not to regard the trade of 1860 as normal, or the increase of exports to the East as continuous; but the cotton trade is not the only one which it would be difficult to turn from markets that seemed to promise high rates of profit.

Such a glut of production had there been in 1859 and 1860, that at the time to which we are referring not a few houses in Manchester and Liverpool felt the severest difficulty in meeting their liabilities. They had plenty of goods in stock, but the enchanter, demand, was not at hand to turn them into gold. In Bombay, 'shirtings' found no buyers; no one cared to inquire after mule-yarns, and water-twist was a drug in the market. There was a larger supply of cotton in England than there had been for years previous to this time. The increasing probability of hostilities in America had induced the shippers of the Southern States to bring forward the crop of 1860 with unusual haste; and before the end of May 1861, the imports from America for the five months of the year amounted to 1,650,000 bales-a supply largely exceeding the total importation from the same source during the whole year of 1857. This unexampled import was superadded to the large stock of 594,505 bales remaining in England at the expiration of 1860. Nor was this all. Cotton was arriving from the East as well as from the West. The rumour of a deficient crop in America, and the murmurs of that coming storm, of which the first flash was seen at Fort Sumter, had roused the feeble energies of the Asiatic planters, and they contributed to augment the cotton supply of Britain. In the first six months of 1861, the Indian supply, which for the same period of 1860 had been 249,000 bales, amounted to 314,500 bales, an increase of 65,500 bales.

But that we know what followed this; were it not that we have since seen a half a million cotton-workers and their dependents become the helpless recipients of Poor Law allowances or private benefactions, we might well think the title of this history a misnomer, and question the existence of a Cotton Famine. A Cotton Famine! In June 1861, the cotton trade was suffering from apoplexy, with a full larder. There was nothing it stood so much in

need of as depletion. Come it must, either by an artificial or a forced suspension of trade. Every one was looking out for buyers. The importers of cotton had invested largely, and pressed by the wants of the American planters -patriotic or rebellious, as viewed through Southern or Northern spectacles-they forced their wares upon apathetic speculators and unwilling manufacturers, who, though possessed of much yarn and cloth, may have had but little cash, and less desire to increase their stocks of goods. No one believed in the long continuance of the war. Though Sumter had fallen two months back, though Mr. Lincoln had gathered together his first army, though the Southern States had become a drill-ground and Richmond a barrack, yet the sales to speculators in Liverpool were less in June than they had been in January, and 'Middling Orleans was quiet,' though advanced to 8d. per pound.

This rise, forced upon the market by the situation in America, was the means of saving many manufacturers from impending difficulties. In 1859 and 1860, the years of 'terrific prosperity' and over-production, Middling Orleans had been quoted on the last day of each year at 63d. and 73d. respectively. The adventitious circumstance of the American war, had brought profits to those who, but for this outbreak, would have had to suspend payments. Notwithstanding the enormous mass of goods in stock, estimated to value upwards of £20,000,000, the rişing market for the raw material galvanised the trade in manufactures into life; and the prices of yarns and cloth having slowly declined since the commencement of the year, now rose languidly, and liberated some of the capital of the cotton trade-set it free to be invested far more profitably in the raw material.

Probably at no one period in the history of the cotton trade was there such a weight of cotton and cotton manufactures in England as at the time of the battle of Bull Run. Production continued at nearly the same rate as it had done in 1860. The exports of yarn and goods for the first nine months of the year 1861 amounted to 537,969,000 lb., less only by 16,250,000 lb. than the exports for the same period of the previous year. But the total production of yarns and goods from January to Sep

tember, 1861, was 779,279,000 lb., of which therefore 241,801,000 lb. were retained at home. The average home consumption for this period would be 135,000,000 lb.; so that in the first nine months of 1861, at least 100,000,000 lb. of yarn and goods were added to the large stocks then remaining in the country. The overfed condition of the foreign markets, especially those of India and China, may be best judged from the fact that they were subsequently troubled with indigestion and loss of appetite for upwards of two years. The weight of raw cotton and of manufactures at this time in the hands, or at the disposal of the British cotton trade, cannot have fallen far short of 1,000,000,000 lb. This was in their possession when first they welcomed a rising market. They had recklessly pushed production beyond requirement; with all the assistance of low wages, light taxation, and perfect domestic peace, manufacturers had made their spindles revolve faster, their shuttles move more quickly, than they had ever done before. They had done this in fear and tremling-they had been encouraged by the excitement which burned at the prospect of such increasing markets-they had aroused a competition which recognised no duty paramount to that of obtaining the largest share of profits; and at the moment in which they might have expected judgment and execution-in the shape of a large depreciation in the value of their commodities-almost in the very hour when the reaction to which they had given no heed was upon them, the scene shifted the war in America assumed an aspect of determined continuance, and the blockade of the Southern ports was declared effective. The price of cotton rose rapidly, and immediately a golden radiance of profit hovered around these plethoric stocks which were stored throughout the world.

The first signs of distress in the manufacturing districts appeared in October, when many factories began to run short time. But the American war, to which this distress was then generally referred, had as yet far less to do with it than the overstocked condition of the markets. Speculation had forced the price of Middling Orleans up to 10d. per pound on the 30th of September; but even this rate would not have deterred spinners from continuing operations, had it not been for the fact that they must work for