The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1855-01-03

enables capital to Cypress labor do not while enfran
chsng enslave labor2 IT, then, money is to be
eved from legislative restraint, should IL not also be d.
vested Of the power conferred by legislation While our
laws stamp extrnsic values upon coin, may not laws
with equal Justice and proprety declare what rate OF
interest may be demanded and received for It's user And
while legislation permits associations and individuals TO
circulate their paper promises pay, money st not
clearly duty TO limit the rate Of usance upon oans Be-
fore declaring gold and silver and their paper
government to assniate money to the products OF Ia
bor by dprvng gold silver and bank notes OF their ar
tiRcial value. Then, and then only, may money be
safely left like the products of labor to be regulated by
where capital abundant and seeks investment at
moderate Of usance referred to for evidence that
free trade in money beneficial to the community This
argument may applicable to condi ton when
capital bears the relation to enterprise and indus
Try in this country that It does in Europe But while
ly II becomes u.s. instead OF relaxing usury laws, to
provide for their rigid execution Indeed the most
valid objection these laws is found in their lax admin
istration While respected by awabiding citizens, and
by cautious and tmd usurers they are dsregarded by
those who either hope to evade them, who rely upon
the honor necessity of borrowers law either
stringent against usury If its enforcement could
be sured would be productive Of sautary effects.
The argument relied upon by the advocates repeal
is that it will make money cheaper But wherever this
experiment has been tried in country the opposite
effect has been produced. Even in commercial me-
tropos where found those who are most strenuous
this subject that description Of paper supposed TO be
exempted from the faint of be negotiated only
at rates of interest varying from twelve to
per per Borrowing at this rate leads
in times Of pressure are the rates of interest high
But what II the power to regulate the whole question
whss Tn cheap
those who it have the power to keep 1t scarce
and dearY There given amount Of capital among u.s.
taking of than the legal rate Of interest, that
capital would be available for all legitimate purposes.
If loans made reluctantly at legal rates, it il be-
cause usurious ones may be obtained through the
violation or evasion of the laws.
The Legislature Of 1850, in accordance with then
prevalent sentiment awakened by the avoidance of
large debt BY incorporated bank under the plea OF
usury, passed law restraining interpretations from
pleading usury. This, in my opinion was change in
the wrong direction. Evils have resulted from that
change which seriously embarrassing the whole
business community. Stimulating at enterprise
and cupdity, that enactment has prompted improve
ments far too formidable for our means. Impatient
for railroads, four citizens misaking confidence for
capital have involved themselves and the country
in fearful aggregate Of indebtedness In their zeal to
hasten the construction OF railroads, time circum
have often been disregarded The question: in too many
instances, seems to have been not whetherhe roads
whether bonds could be negotiated at matter what
rate of discount This policy has thrown millions of
deprecated railroad securities upon the market home
and abroad, and the reaction leaves with thou
sands of miles of unfinished roads, and stringent
opsrssn s al te
FORE repeating the law which restraints corporations
from pleading usury, is respectfully suggested
The policy Of constructing railroads by mixing credit
with capital, though to degree useful and safe, has
grown into an abuse. Mortgage bonds, when protected
the completion Of legitimate enterprises But when as
in too many instances, companies issue bonds greatly
@ %
| win, doubtless, impose such restrictions, in this re-
spect as experience suggests and the general welfare
Connected with our railway system is another feature
of great but delicate interest Iu their audable desire
to avail themselves of the advantages of such improve
mentss Cities villages and towns have loaned their
dit to railroad companies This Is power which should
be sparngly granted by the legislature and cautiously
isad nv he
yet general rule 1t better to leave these projects
Of Tie sad 81 b, Of no at al
cu11 be pa TO ss% M 1os The policy
self constituted and practically close corporation has
grown to be power in the State, exertng potent in
tnence oyer all its monetary Affairs and seriously a
and OF other States The standard of value for public
securities, whether national state, municipal corpo
asceraned reliable market value for such securities is
readily admitted and brokers, in this as in other coun
tries are the recognized agents for their sale.
But the bona de transfer Of stocks has ceased to be
tho only THO most eonsisr@bi. its Of the bu
sness of brokers' Time sales Of securities constitute by
far the largest element in the daily operations Of the
Board. Many of the stocks and bonds quoted daily,
Fictitious value until by the adrotuess and collision
Of the parties interested the purposes of their creation
answered. and them like their equally worthless pre-
decessors disappear to give place to other schemes
dishonest in inception and fraudulent in design The
services of brokers frequently required and from
some of their number readily obtained to depecate
value of undoubted securities to adyan,e the price
| of bubble shares.
These evils, however, would DO compare lively limited
nextent, and less alarming in tendency but for that
feature in the operations of the Board to which have al
uded Its practice Of time sales Of securitiesa prac
tice which prevails to alarming extent-fosters
and stimulates widespread spirit of gambling This
spirit pervade all classes is rife in Cities and is
abroad throughout the country As in the OF lot.
teres before their the temptation which
promises large and easy gans not only exces the hopes
the caution Of the prudent Disastrous failures in e-
gimate business are often traceabe to wild and reck
less time operations in stocks And most Of the frauds
and defslcations which impair the credit Of moned in
situations and destroy confidence In the integrity of in
| dividuas, owe their origin to the same pernicous
| cause.
1t is not alleged supposed that the Board OF Ero-
kers such is composed of men of exccptonabe char
acter On the contrary 1t is the high personal pecta
blty the influential position OF the members Of the
Board that has long secured liberation and mpunity
for transactions so vicious in prime po and 80 desruc
In view therefore, of an abuse OF such magnitude,
and OF consequences injurious deem il my duty TO
submit 10 the Legislature the proprety OF passing
law far reforming and restraining the traffic in public
securities as to dvest il Of this pernicious feature
IL not sufficient that these transactions are, by
present laws Illegal The evil only be eradicated
| by providing adequate penalties. An Association
whose financial influence Is greater even than that
| precate this, and TO depress that class of secu-
rites and to which SO large body Of citizens paw
tons as neither to retard the general welfare nor relax
| the public morals.
There is reason to apprehend, unless some further
and more efficient safeguards are thrown around the
elective franchise, especially in cities, that the bal
lot boxes Will to reflect the popular will Each
succeeding election discoses renewed of alarm,
in combinations to defraud the people, and too fire.
queDty is feared with the knowledge and coopera-
ton of those whose Official duty IL is to preserve the In
tegrity of the ballot box Such approximations fire.
quenty expressed by those who insist that invest-
CATION would furnish painful confirmation Of the truth
Of all they fear Heretofore the principal abuse Of the
elective franchise grew out Of illegal voting. But IL is
alleged and believed that greater abuse exists
That abuse has become formidable and practised
boldly that result In many OF the election districts OF
the city of New York is supposed to depend less upon
the sentiments and intentions of the electors than upon
the corrupt action of their inspectors Frauds OF this
nature strike at the foundation Of free institutions
representative government cannot endure even II 1t
| box come to be habituay violated. I cannot doubt
therefore, that subject Of such vital Importance will