Nashville union and American. [volume] (Nashville, Tenn.) 1853-1862, 1857-12-11

7th inst
| Mr. GOODPASTURE said. Mr. Speaker:-There
are certainly many arguments to be urged in favor
Of conventional rate Of interest," and they are in
sisted upon with great pausbiity by the friends Of
this bill. Bat, upon question Of so much import
ance as that Of interest," cannot be too careful in
investigating and scrutinizRg its various effects and
bearings upon the trade and commerce Of the coun-
try IS it interests, less, all classes of our
citizens In view of the Importance Of the subject
l ask the indulgence Of the Senate, whilst 1 give
what believe 70 be the legitimate and inevitable
results consequent upon the proposed passage Of
this bill
The first, and probably one Of the strongest argu-
ments produced in favor Of increasing our rate Of
interest," is based upon statements of facts by Sena-
tors on this floor; and know nothing to the con-
trary but that these facts true. Senators state
that very large amount of capital is annually with
drawn from midst and loaned in other States at
higher rate Of interest than is lawful here; and,
that that capital would remain at home were it not
fer our usury laws
Admitting that our citizens do loan portion Of
their capital, and large portion, if you please, as
stated by the Senator from Davidson, in the State of
Mississippi, at ten per cent. interest per annum.
Does such an operation prove injurious to the State
| of Tennessee? 1 answer, it does not. Upon the
contrary, it is good financial operation, far as
the interests Of the State concerned, and GER
tany SO, for The individuals who make the invest
ments. l assert the proposition have made to be
true, and challenge successful contradiction.
believe it is admitted, by the best fnaaciers and
business men throughout the country, so far as
nave been able TO learn, either from works bust
ness any other of information, that the
entire capital of the United States, vested is in
the various occupations Of life, does not yield an
annual income, or profit, of six per cent. If am
correct III this statement, and think ami am
not L ask Senators correct me-the State, or
! community, who borrow money at greater interest
than six per cent per annum, is compelled to loose
money by the operation, aud, GIfortorI the lender
makes money. 1t is purely business transaction,
and profit aud loss depends upon q solution Of the
question, whether the legitimate business of the
| country pays more than six per cent per annum
upon the capital vested.
Ii am correct in the view have taken Of the
| subject, have fully disposed of the argument
made with much confidence by the friends of this
BILL that capital leaves State and seeks invest
ment elsewhere.
/ insist, and 1 am fully sustained by reason and
argument that it is to the interest of the State Of
Tennessee, her citizens, to loan their money In
Mississippi, or anywhere else, if 1t yields them
greater income than it would if vested in the legti-
| mate channels of business at home. Our citizens
who loan their money in other States at high rate
Of interest, receive the same again. together with
the interest, thereby adding to their wealth, and
| consequently, to the wealth Of the State.
| Then, is it crying evil that money leaves our
State Does it demand legislative action at our
hands? l answer, positively, it does not.
Again, ought the rate of interest to be greater
| than the average income, profits, upon inves :
ments in the various industrial and agricultural
pursuits of the eountryi 1 apprehend every man
who knows anything about political economy, will
say it ought not.
Suppose the State of Tennessee should borrow of
of the State of Mississippi one million of dollars,
| and execute her bonds for the same, bearing ten
| he he in hiatt IL
ton than if she did not have the million of dollars
in her treasury, and owned nothing? Certainly she
would not Then suppose citizens loan the cti-
of Louisiana, if you please, any other State,
81 600 OOO at ten per cent per snnum interest," have
We lost anything? Who is hurt by the operation
Certainly citizens not-neiCher is the State
for if it is profitable to the individual it is prota
BILE to the State-bound to be So The average worth
/ Of money being six per cent. per snnum, we are
1 making net profit of -four per cent. per snnum.
hold that a man is none the better off by having
his pocket full Of money, If his notes out, for it
bearing six per cent interest," but if he is pay
ing per interest," it would be better for that
man to drain him Of his money at once. and relieve
| him Of debt.
Mr.. Speaker The arguments against this bill
| are almost innumerable. What effect will it have
upon the price of State bonds? The actual in
debtedness Of our State together with her liabilities
for works of internal improvements, l believe is
about twelve million of dollars not looking to her
prospective Indebtedness. Suppose We pass this
BILL and increase the rate Of interest from six to ten
per cent. per annum, the legitimate effect of such q
Law would raise the price of money to that standard
then suppose all the other States of the Union
should follow lead which is not all improbable
for believe it is said some ten or twelve of them
have already taken steps in that direction. l ask,
what is TO become of our State bonds? They are
now selling at about 80 cents to the dollar, when
money is only worth six per cent. interest," increase
the rate of interest to ten per cent per snnum, and
you decrease the price of State bonds in the same
ratio, hence you see our bonds will be selling at,
instead of 81 TO the dollar, 40 cents to the
dollar; this will be the inevitable consequence, and
defy any of the friends of the bill to produce any
good reason to the contrary; they cannot do it,
My proposition can be demonstrated as clearly as
any question in mathematics 1t may be said that
all the States wild not increase their rates of inte
rest but this is begging the question: if ii is right
1t IS to be presumed 1t will be done, the friends Of
the bill think it is right.
If our State bonds depreciate in value, as 1 have
stated which is inevitable, THAT is to become of
works of internal improvements? You at one fell
stroke, cut off every work of internal improvement
in the State, where they have not completed the
work and disposed of their bonds Who | ask,
will buy State bonds drawing six per cent. per
annum, when he get ten per cent. for his money
The answer is, no one, not one out Of the twelve
million OF bonds, will find purchaser at heme.
l state this to be true, and am sbundsntly able
to establish its TRUTH that every cent of interest
paid by any State county, over and above six per
cent. per annum, is q clear loss to the State or
county who pays it. Six per cent. being the axiom
average of profits upon investments in the various
pursuits and associations of life throughout the
Union There exceptions TO all general rules,
occasionally q speculatOr may make very large pro-
fits, whilst upon the other hand, they frequently
break speculation, however, never did, and never
will increase the real wealth of country; whilst
one Spectator is getting rich another is becoming
bankrupt, and in all likelihood looking him out
home beyond the Rocky mountains, leaving his
creditors the honest unsuspecting portion of com
munlty, to suffer and bear the loss consequent upon
his wild and visionary schemes Of speculation. 1t
requires labor, real industry, TO make a country
prosper, there is other legitimate way of making
wealth. it is true, sharpers may get hold of it after
it is made, and make themselves rich, but not the
country; it is to the aborers indebted for all
prosperity, it is through them that acquire,
whatever of substantial wealth do acquire, the
Spectator only seeks by kind superior ken strip
the aborsr of his just earnings. Should we egislate
for the benefit of the Spectator and money changer
or for the real bone and sinew of the country, the
farmer and the mechanic? The laboring man is
satisfied with the rate of interest it is and desire
it to remain unchanged. Then are we to be con-
troled and influenced by the spectators and money
changers of the country; have shown that they
are a worthless class of community, so far as the
Upon the ether hand, it is to wild and visionary
schemes Of speculation, that the present panic in
money matters is justly attributable, and to nothing
else. for one, shall, to the utmost of my humble
ability, protect the interests and rights of the
mon man. the farmer and the mechanic, and not fos-
ter speculation, when its effects ruinous The
ShilOcks and money-changers must look for help
from some other quarter. The strong are able to
take care of themselves, the weak require the pro-
lection Of the law. l hold to the doctrine that we
should confer the greatest good upon the greatest
number.
Further, Mr.. Speaker, 1 have shown that the
practical operation of this bill will be to depreciste
the price of State bonds thereby cutting off all our
works Of internal improvement in the State; but l
have not depicted half the train of evils that will
follow with unerring certainly. The free banks
are based upon State bonds, and the value of their
notes depends upon the price of bonds. That being
true if you depreciate bonds, the free bank notes
must depreciate in the same ratio. And who, l
would ask is the suffereri The answer is the peo
pie; the honest yeOmanry Of the country who have
exchanged their property labor for these notes.
Do we desire to such state of things at present?
Surely not. Have we not had within the last two
months sufficient foretaste of hard times, money
panic, deprecated currency, &C., &c. without fur