The spirit of democracy. [volume] (Woodsfield, Ohio) 1844-1994, 1844-12-20

IeuueCts udt De most PeIicct pdhh CiCuidiio
would be one which should be precisely equal i
amount to what the circulation of the same coun
try would be in the precious metals, were no othe
circulation permitted"
Banks create debt, but not capital. Actual capl
tai is produced only by the productive labor Of tn
country. Although banks produce debt, and no
capital, yet by the insiduous operations of the pa
per money system, they levy tribute upon til,
productice industry of the country, and take from
It large portion of its profits. This is shown b,
the fact that although they add no actual capital tt
the wealth of the country, yet they accumulate
large amounts Of il from the products of labor. The
amount paid to banks, and the losses sustained BY
them in their ultimate results, fall upon the pro-
ducts of labor. It would be useless 10 attempt to
define all the nsiduous and mysterious expedients
by which the machinery of bank debts and paper
money tax productive industry, and usurp the lie.
gitimate rights of labor in the distribution of the
wealth of the country. The direct tendency Of
the system as heretofore conducted in this county,
is tolead to the opuence of the ew and the pauper-
ism Of the many.
Some idea can be formed of the oppressive and
desolating effects Of the paper money system, from
some authedtic reports on the subject of losses
sustained by it, and which should never be lost
sight Of in attempts to establish new system of
banking. It app ears from special report made
by the present bank commissioner of this state to
the Legislature at the last session, that since the
year 1881, nineteen banks in this state have been
closed up and found insolven, and the loss to the
community by the low price at which their paper
was taken up, is estimated at 81 ,405 1886 81, and
the loss by the depreciation of the stock at $685.,
264 76. II is also estimated in the same report,
that the amount paid by the people of Ohio for the
price Of exchange in the business of the country
above the proper rate, on account of the depreca-
ton Of the paper currency, is sic, ,536, ,6s3 O5;
making total loss within the last eleven years to
the people Of Ohio, of over twelve millions and
half This calculation does not include the losses
sustained by the paper of broken banks in the sur
rounding States, nor the amount paid to the banks
by the way of interest or discount, nor any of the
losses sustained by the people in the bank revusion
which spread desoation and ruin throughout the
State between the years 1914 and 1924. 1t appears
from report made to the Senate of the United
States, by the Secretary of the Treasury that the
number of banks which have become insolvent IN
this country, between the years 1889 and Is4l
amount to 1895, and the aggregate amount of the
loss sustained by the government of the United
States and the people is computed at 365, ,45I ,497
1t appears from the same authority, that the total
amount paid by the community to the banks, for
the use of them the ten years preceding ls4l, in
the United States, has been the enormous sum of
$2s2,OO 900, which would average annually,
$2S, ,2OO,O0 Accurate statistical and financial
Journals of the times, furnish US with the follow
ing computation of the losses resulting from the
recent bank revulsion in this country, to wit
On bank circulation and deposits, $54, ,OOO, 900
Bank capital failed and deprecated, 24s,cOO,OOO
Company stock, 10000 900 !
State stock deprecated, 100, 900 900
Real estate, 800, ,OO0, 900
Total loss, $7S2, 900, 900
Startling as these facts may appear. when group
ed together, they do not include any thing like all
the injury and suffering produced by the immense
fluctuations in the standard of value. And it Is
correctly sad that the greatest injury TO society
resulting from this state of things, is in the up
heaving of the elements OF social order, and the
utter Generalization of men by the temptations to
speculations, which end in swindling to retain
their ill-gotten riches" In attempting to frame
a new system of banking it becomes us to profit
by these bitter fruits of experience, and provide
against those evils and abuses which have hereto
fore been inflicted upon the suffering people.
A proposition has been recently made in this
State to the consideration of the Legislature at
the last session, somewhat new in its character to
he people of Ohio. Itproposes the establishment
IF banking system based upon government
tocks, with the special powers and exemptions of
he old system under the provisions of general
aw. The capital of the banks is proposed to be
invested in state stocks as an alleged security to
he bill holder, or other words, the banks are to
'e founded on the basis Of government debt, and
'ank debts are to be made dependent on the debts
# the government for their security. OF all the
schemes for banking which have been devised,
his is the most Objectionable and the most dam
erous in its tendencies to the independence
nd purity Of the government, and the liberties of
he people. It rests fundamentally upon the same
rincipe upon which was established the bank Of
England, the capital of which was originally and
as ever continued invested in the stock or debt of
he government. 1t proposes union of bank and
tate-the formation of an incesuous and unholy f;
oalition between an organized and combined I
interest, and the civil power upon which ,
he people depend for the safety of their liberties
he debtor is correctly said to be the slave Of the
reditor, so the State under this system would
ecome the dependent and subservient instrument
{ the banking interest The establishment of {
his system would at once create and build up
within the bosom of our own State combined T
nd extended money power, having direct !
interest in perpetuating and enlarging the debts t
the State. The stock of the State would not
My be found to be profitable investment for the