(Private and
unofficial)
New Orleans, Oct. 10th, 1862.
Dear Sir: I
have received your official letter of Sept. 22nd. enclosing letters of Mr.
Barney and Mr. Norton — and asking information whether any portion of shipments
to this port reach the enemy. My official reply dated yesterday, is
correct so far as it goes, but additional facts exist, proper to be stated only
in a private letter.
Ever since the capture of this city, a brisk trade has been
carried on with the rebels, by a few persons, under military permits,
frequently with military assistance and as I believe, much to the pecuniary
benefit of some of the principal military officers of this Department. I have
suspected it for a long time, and spoke of it in my private letters to you, of
Aug.
26th. and Sept. 9th. On the 5th. October, your regulations of Aug. 28th.
reached me. I immediately stopped all trade with the enemy, and as this brought
me in contact with the persons who have been conducting the trade, I acquired
much information. Almost all the information to be given in this letter, has
been collected this week.
A brother of Gen. Butler is here, who is called Col. Butler,
though he occupies no position in the army. Government officers, citizens, and
rebels, generally believe him to be the partner or agent of Gen'l. Butler. He
does a heavy business and by various practices has made between one and two
million dollars since the capture of the City. Gov. Shepley and especially Col.
French (Provost Marshal) are supposed to be interested, but these officers, I
believe to be entirely under control of Gen'l. Butler, who knows everything,
controls everything, and should be held responsible for everything.
There are two channels of trade with the rebels — the River
and Lake Pontchatrain.
River trade must be conducted by steam boats. There are
eight or nine. River boats here, all seized and now in the hands of the
military authorities. Col. Butler has used these boats as he pleased, for
carrying up and bringing down freight. I had no control over them and could not
know what was transpiring, for the military authorities controlled them, with
whom I had no authority to interfere. Troops were at Baton Rouge and below
Vicksburg, and it was to be supposed the boats were used for public, not
private purposes. Of late, frequently, one or two infantry companies would
accompany a boat taking up cargo and bringing back produce. This service was
unpopular with officers and men, who enlisted for the benefit of the country
and not of speculators. I say no more concerning the River trade, except that
it has been constant and sometimes active.
Of the trade across the Lake I have more accurate and more
information, because there are no government vessels there, and it was
conducted with schooners. Shortly after arriving here I learned that large
quantities of salt had crossed the lake to the rebels, and supposing it to be
smuggled, took measures to stop it thenceforth. Two weeks later a schooner
loaded with 1,000 sacks salt to cross the Lake. I directed the inspector to
seize the vessel, and immediately called upon Gen. Butler, and requested a
guard to be put on board. This was about 9 o'clock at night. He appeared
indignant at the attempt to take salt to the enemy — ordered a guard on board
the vessel — and ordered the immediate arrest of the Captain and shippers. The
next day I had an interview with Provost Marshal French, who told me it was all
a misunderstanding. The shipper had a permit for 500, but not for 1,000. That
the shipper and captain were released — the vessel unladen and released also. I
told him, he had no authority to release my seizures, but it was now too late
to help it.
After this but little trade was done until six or eight
weeks ago, when Gen. Butler gave a permit to a rebel, to ship four large
cargoes, much of which was contraband, across the lake. I immediately called
upon the General, who said that it was the policy of the Gov’t. to get
cotton shipped from this port, and for that purpose, to trade with the enemy.
In the conversation he left upon my mind the impression that this course was
approved at Washington. I then had entire confidence in Gen'l. Butler, and my
letter of instructions had directed me to consult with him frequently. For the
last two months trade has been active across the lake, nor had I any authority
to stop it, until the arrival of your regulations on the 5th. Oct., as above
mentioned.
The following statements are made to me by various persons.
One man says — that he took over 600 sacks salt just before
I arrived, and was gone six weeks. Gen'l Butler gave permit. Two dollars per
sack was paid for permission to take from New Orleans. He sold 400 sacks to
Confederate army at $25. per sack, and was permitted to sell the other 200 to
citizens, at $36. per sack. He did not own the cargo, but received one fourth
of net profits. He cleared $2,000. The owners cleared $6,000 — good money.
Dr. Avery, Surgeon 9th. Reg't. Conn. Vol., states that he
accompanied an expedition to Pontchitoula, just North of Lake Pontchartrain,
about three weeks ago. A skirmish ensued — he was taken prisoner and taken to
Camp Moore. He saw a large quantity of salt in sacks there, lying by the
railroad. A rebel officer said to him. “We bought that salt from Col. Butler.
We paid $5. per sack for the privilege of shipment from New Orleans. To-day
that salt goes to Richmond for the army. To-morrow or next day another cargo
will arrive. The army get their salt from New Orleans. The Yankees “will do
anything for money.”Dr. A. was subsequently released and is now in this city.
Capt. Cornwell, Co. A. 13th. Conn. Reg't. was stationed with
his company at mouth of New Canal, for about three weeks, ending last Saturday.
He states that the first schooner going out, was laden with large am't. of
contraband articles — some medicines, including 80 gals, castor oil — It had
Shepley's permit. He sent his 2nd. Lieut. (Kinney) to Gen. Butler — who said “Go
to Gov. Shepley and ask him if he does not know that these articles will
go right into the hands of the enemy.” Gov. Shepley said, “Return to Gen.
Butler and say that I consulted him before giving this permit.”
Whereupon Gen. B. said, “Well, let it go, since Gov. S. has granted a permit.”
The same thing happened two or three days afterward, when Gen. B. received the
messenger, and at once wrote on the back of the permit — “Gov. Shepley's passes
must be respected.” Capt. Cornwell now wants to go home.
The inspector of Customs at the New Canal is very sick, and
therefore I cannot get his statement at present.
Mr. Clark applies for permission to trade with the
enemy on a large scale and states that he made the arrangement by Gen. Butler's
consent. I let his vessel leave in ballast, taking bond in double the value of the
vessel, that she would be returned into my custody within 20 days. He had a
letter from Gen. B. which I caused to be privately copied, and also a letter
from Col. Butler. Both are enclosed herewith, marked A.
Don D. Goicouria (of the firm of D. D. Goicouria and Co.,
New St., N. Y.) has been here four months and has made about $200,000. He asks
to continue trade with the enemy authorized by Gen'l. Butler. He has taken two
thousand sacks salt to the confederate army. He made an arrangement with Gen.
Butler and Benjamin (Rebel Secretary of War) to take salt to the enemy,
bringing back cotton — in exchange, at the rate of ten sacks in one bale of
cotton. He goes North next steamer, and will apply to Secretary of Treasury for
permit to continue the trade. He has rec'd. here 200 bales cotton. His salt
goes to the Confederate Army. He says, Col. Butler told him that he (Col. B.)
had sent North 8,000 hogs, sugar of his own, worth in N. Y. $800,000 or
$900,000. Besides salt, he has taken to the enemy large amount of other goods.
In his interview with you he will be able to tell you everything about trade
with the Rebels if disposed so to do.
A Roman Catholic Priest, from Bay St. Louis, told me
yesterday that in his vicinity, Salt was selling for $3.50 per gallon — or $25.
per bushel — and Flour at $55. per barrel.
(A Sack of salt contains about 4 bushels).
Mr. Lloyd applies for permit to trade. He states that Gen.
B. granted him permit, to take effect whenever he pleased — and offered him
Gunboats and soldiers. He declined such aid, preferring to make arrangements
with Confederate authorities, which are now completed. That he promised to
bring hither 5,000 bales cotton and sell them to Gen. Butler, at the market
price. He insinuates that there is a further understanding between himself and
Gen. Butler, but declines stating what it is. His agent's name is Burden and
his application (with list of cargo) is enclosed herewith, marked B.
Another, application comes from Wm. Perkins and is enclosed
herewith marked C.
E. H. Montgomery's vessels was stopped by me in New Canal on
the 5th. October. His permit from Gov. Shepley and list of Cargo is enclosed
herewith marked D.
All the vessels crossing the Lake since Sept. 23rd. have had
Gen. Shepley's pass. The inspector has furnished a list of them with their
cargoes — which list is enclosed herewith, marked E.
After receiving copy of your regulations, I told Gen. Butler
that this trade gave aid and comfort to the enemy without benefit to the Gov't.
— that it demoralized the army — disgusted loyal citizens — and degraded the
character of the Gov't. He smilingly assented — said it ought to be stopped —
that he didn't see why Shepley granted such permits — and that he was going to
visit Ship Island, and when he returned would see me about it again!
The stringent blockade enhances prices in the Rebel States,
and is a great thing for the military speculators of this Department — and
their friends.
I know of 5,000 sacks being sent to the enemy, and I think
more than 10,000 have been sent.
I suppose your regulations (28th. Aug.) apply equally to the
portion of the State within our lines—as well as to that under insurrectionary
control. That supplies can be sent anywhere to a loyal citizen for his own use,
but not to sell to rebels, and that I am to control the whole matter. If I
mistake please inform me.
Most of this trade can be stopped, but I believe the present
military authorities are so corrupt that they will take all means to make
money. The amount of goods smuggled from this point to the enemy, has been
trifling. Gen. Butler has always been kind to me, and our personal relations
are upon the most pleasant footing. He has great ability, great energy,
shrewdness and activity, and industry, but he can never acquire a character
here for disinterestedness. Many officers and soldiers want to go home, not wishing
to risk their lives to make fortunes for others.
SOURCE: Diary and correspondence of Salmon P. Chase, Annual
Report of the American Historical Association for the Year 1902, Vol.
2, p. 320-5
