Secondly. I would respectfully suggest a division of the labor now devolvent upon the Government agent, as follows: Appoint or detail some discreet officer, or employ a commission house, vested with authority to purchase cotton, attend to its transportation, and store it at each of the above-named points, as may be most convenient from the place of purchase; revoke all authority granted to any other officer, agent, or contractor to purchase cotton within the State, making it exclusively the business of one man and his agents, thus preventing competition between officers and agents purchasing for the same purpose.

Detail an officer (a thorough business man, if to be found) who will inspire confidence in his intercourse with the merchants of this place and Matamoras for the purpose of disposing of this cotton, negotiating for supplies, filling requisitions, &c., his office or headquarters to be at this place. Revoke all authority heretofore granted to contract for any article based upon cotton by any other officer or agent; vest him with discretionary powers to sell this cotton at the places where it may be concentrated or at Brownsville, as he may deem expedient, and I will guarantee every article requisite for the army can he purchased without difficulty and the credit of the Government sustained.

I will remark here that all that capitalists require to furnish the army is to be satisfied that the cotton to meet the payment is stored at a given point, and there will be no disappointment when the transportation is sent after it. They will either take it at the market price here, less the regular transportation from the point of delivery, or they will have it hauled, advance the freight, and sell it on account of the Government, charging 2 1/2 per cent. commissions for selling and the same for advancing.

Another advantage to be gained by this policy is that stores destined for the interior can be purchased to be delivered where the cotton is stored and sent by the same teams that haul returns loads of cotton. Again, no facilities are granted or cotton delivered until the stores are received.

There are many other reasons which time will not permit me to mention but which will probably suggest themselves to you, why this policy should be adopted. I will, however, mention one other which I regard as important both for the protection of the officer charged with this duty and the Government. It is this: At present there is no check or way by which the Government can be protected against fraud, and, on the other hand, one officer being charged with the duty of purchasing cotton, transporting and selling it, purchasing and introducing supplies, is forced to rely upon his own statements to remove any censure or charges that may be made against him, while the plan suggested by me would established a check by which either fraud or error could be detected and corrected on account of the transaction passing through two officers.

I have thus hastily expressed my views upon this important question, and it affords me pleasure to say, in conclusion, that my intercourse with the prominent and wealthy merchants of this city and Matamoras has satisfied me that they are willing and prepared to extend us every facility that we can reasonably expect, if we can only give them assurance that they will re reimbursed and reasonably remunerated for their services. Offers have been made to me, on the terms above stated, to furnish munitions of war, quartermaster's, subsistence and medical stores in any quantity that is required with any guarantee that we may ask for a faithful compliance with their agreement.

In regard to the supply of the troops on this line I have the pleasure to inform you that by and with the advice and approval of the major-

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