The spirit of democracy. [volume] (Woodsfield, Ohio) 1844-1994, 1846-05-16

anu Tie ueDLOf, the SeileI ana Inc Duy-
er, are involved IN common ruin.
| At the bottom of this ruin, the banks
are always found, and their influence is
by far most pernicious in substantially
agricultural communities. This will
be seen by tracing their operation in the
distresses that have often occurred. and
will continue, periodically, to occur, as
long as the present system exists
When the country is free from debt,
and every man who is industriously en-
gagged in his present avocation, is pros
! porous, and accumuating--ifby slow,
by sure means--a competence to sup
port him in the evening of life, and
when he needs no expanded credit
from banks, to induce him to venture
beyond his means or ability, in grasp
ing for wealth, at this crisis the bank,
flushed with paper money, and no call
for specie to redeem its bills, pushes its
loans upon the citizen, seduces him
from his accustomed pursuits, allures
him with the hope of acquiring hidden
wealth without labor, into wild and
reckless speculations; and just when
he is most pressed for want Of new
loans to pay old ones, leaves him, not
only ruined himself, but the cause of
embarrassment and ruin to his friends
and neighbors who became his endors-
ers. @
| But the speculator and the over-tra-
der are not the only sufferers. They
make others suffer. Induced by the
facility of getting money of the banks
in easy times, the merchant and trader
extend themselves on borrowed capi-
tai beyond the wants and ability of the
community; and as prices always rise
when bank paper is plenty, and fall as it
contracts, the consumer not only pays
the highest prices for his goods, but he
also pays the bank interest to the ira
der on borrowed capital
Thus. the hard-working man who
means to live within his means, is COM
PEELED to buy at the highest prices
when the banks make money plentiful;
and the moment they make it scarce,
he finds the dollarhe earns, paying not
more than two thirds or three-quarters
of the dollar he owes.
Again, the depreciation of bank bills,
and the loss by failures of banks, fall
most heavily on the laboring communi-
ty. When money is plenty and credit
expanded, the banks throw into circu-
ation all the bills they can issue, and
drive the specie out of the pockets Of
the people. Their paper every where
becomes substitute for money. Pa
per money is plentiful and cheap, and
property, increased by this false stand
ard, rises exorbitantly high. Pursuing
this course of artificial prosperity for a
few years, the people become greatly
indebted. and when the crisis comes,
the paper is forced home upon the bank.
and it turns out to be nothing but pa
per. There is no gold or silver, or not
one dollar to thirty, to redeem the pa
per promises; suspension follows; and
down go the deprecated bills. And
in whose hands are these bills? Not
of the borrower and speculator, who
got them from the bank on false credit,
but in the hands of the farmer, the me-
chanic, the honest unsuspectmg labor
ing community, who received them
from the borrower, at par value, for
their produce, their work, and their toll.
Such men are least able to retain the
bills till something may be got for them.
In their necessity or alarm, least they
lose the whole, they sell their notes to |
the nearest broker; to the specuator
who borrowed them from the bank, or
perhaps, the bank directors and agents
themselves, at ten, twenty, and fifty |
per cent. discount; and thus, while the
poor bill-holder loses this discount up.
on his moderate earnings. the rich bor-
rowermakes that amount in clear profit,
by taking up his notes at par with the
money he bought atdiscount.
When this crisis arises, in pecuniary
affairs, how are the debts of commu-
nifty, between man and man, to be paid?
The gold aad silver coin has been driv-
en- out of the country by the bank bills,
which Pretend to representa-, being so
much below speciein value. The debt
or who has property abundant to pay
his debts in good times, can find moth
ing to pay with. The banks are down,
and cannot loan him even their depre-
ciated bills; and ifibe could borrow
them,he would be still worse of, be-
cause he must take a deprecated pa
per dollar Of the bank, for which, when
his note comes due, he must pay full
dollar back, with interest; and with this
deprecated paper, he pays his debts at
the ratesof three for two. or two for
one, as the discount may happen 10 be.