by a prompt and judicious use of cotton in exchange for army supplies, and may still be saved in future operations of the basis on which the cotton office, recently organized by order of Lieutenant-General Smith, is sanctioned and provided for by law. You have been furnished with a report by that office, which explain their policy, and have no doubt been made acquainted with the character of the chief and his associates for integrity and capacity. The mistake heretofore has been in placing this business, purely commercial, in the hands of gentleman without experience. I regard the mission of this cotton office, if duly sustained, of the utmost importance, both in sustaining the army and the currency. To illustrate the latter, I will mention one single transaction. Blankets costing &2 were bought, delivered here, at &3; paid for in cotton at 15 cents (the cost). The same quality is sold in the stores at &65 in currency, and the quartermaster offered &40, in a certified account, and would have got them at that price if he had been able to pay at once.

I think I am within reason when I estimate that the cotton office can save in purchases, compared with those made for currency, &9,000,000 out of &10,000,000.

Begging your indulgence for having so unwittingly extended this communication, I have the honor to subscribe myself, very respectfully, your obedient servant,

JAMES SORLEY,

Depositary.

HEADQUARTERS TEXAS COTTON OFFICE,
Houston, Tex., January 7, 1864.

Major J. P. JOHNSON,

Assistant Inspector-General:

MAJOR: Conceiving it to be essential that you should be informed of the organization and purposes of this office, I take pleasure in reporting to you.

The cause of the organization was the desire on the part of the generals commanding the department and district to unite the cotton business of the Government in one head, and thereby probably insure a certainty to parties dealing with the Government-both planters and importers-which would reinstate the confidence which has been so long wanting, owing to the uncertainty attending all the cotton operations of the Government, caused by the want of uniformity of action and the various conflicting orders heretofore issued on apparently good grounds. To obviate the necessity of any interference in cotton matters by the district military authorities, this office was organized, with power to regulate the cotton trade of the State for the best interests of the Government.

Our address to the cotton planters of Texas, inclosed,* sets forth the prime objects of the organization and its policy.

Myself and associates, with the exception of General Kyle, who was a planter, are old merchants, and trust to be able to render efficient service to the Government in this trying moment. We have had the misfortune to lose our associate, General Kyle, within a few days past, and have to regret the deprivation of this valuable aid. We have none of us sought the position, and only accepted it in view of the sufferings of our distressed country and the wish that we might in some degree re-

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*See p. 480.

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