The Evansville daily journal. [volume] (Evansville, Ia. [i.e. Ind.]) 1848-1862, 1858-07-16
The Interest Laws.

The Interest Laws.
One of the important subjects that will
command the attention of the next Legisla-
ture, is the law against usury. The interest
laws upon the statute book have no force in
preventing usurious practices; their only
effect ia, to drive capital from the State
Banks and all classes of citizens openly dis
regard them, except the timid and conscien-
tious, who rather than incur the penalties OF
the law, or offend their sense Of duty as
citizens by violating statute, send their
money into Ohio and Illinois, where the
laws permit them 70 take ten per cent. Il
we may Judge of the influence OF these laws
upon the whole State, BY what we have
heard in our own section, the operation OF
them Is very detrimental in Withdrawing
the surplus money Of our community 70 i'm
prove the lands and property Of ether
States. A great deal of Southern Indiana
capital, as is we'll known, has gone 70 Iowa
and Minnesota to be loaned on Mortgages.
Posey, Gibson, Knox, and ether counties in
rhe Wabash Valley, have nearly all their
money drawn from them to be invested in
the lands-and labor for improving the
lands of Illinois where four per cent higher
interest can be safely taken, than at home.
The Eastern portions of the State are drain
cd of their money by the influence of the
Ohio laws, aud the North by those of Mich
igan-
The policy of our usury laws is Z subject
in which, others beside the lender and Dor
rover have an interest. The laboring man
has q deep concern in all that inau-
ences the currents Of money around him
Whatever amounts remain or come here
for investment has to go through the labor
ers hands in some form, in order TO get a
profitable investment. Whatever is drawn
away for expenditure in other places, takes
from labor here, SO much employment
Money is the chief agent by which labor is
kept at work; wages rise and fall inevita-
bly, with its Gibbs and flows. The working
man should, therefore, be the advocate of
all measures that will bring money into the
community around him.
!. 10 rrerostcrcus TO suppose VIC can AZ
tract money or retain what we have, with
laws restraining US to six per cent, while
the adjoining States permit the taking OF
ten per cent.
The morality of the question, which was
originally the basis of all our usury laws,
is matter now conceded and settled in
public opinion; it is acknowledged that a
man has as clear moral right to place his
own value on his gold as on his wheat; OF
he can stipulats for the rent of his coin as
we'll az for that of an implement, a house,
OF piece Of land. The policy of the trade
in money as it affects the material interest
of the community, is now the only subject
Of dispute. Its opponents contend that the
repeal Of the uSury laws places the poor
man and borrower at the mercy Of the rich
lendee; but the advocates of repeal contend
upon experience in all branches Of trade
that rise in rates, increases the supply
and that money would be drawn from
abroad in sums, TO reduce conventional in
terest below its present rates II is certain
that relief from all legal restraint woult
not enhance the charges Of interest for tn
law is no check to the demands Of ayari
cious lenders, but affords him pretence 70
charging premium for the risk of viola:
ting them.
In Ohio and Illinois the Law allows tn
creditor 10 contract for ten per cent, but
be stipulates for any more, he forfeits tn
whole interest. The recent law OF Pennsyl
vania IL we'll adapted 10 our condition an
viii satiSfy the prejudices of those who ~
opposed to free trade in money. The law
leaves parties TO contract for any rate Of il
terest they choose voluntarily 70 pay; bu
the law will give the creditor no aid to CO
lcct more than six per cent. interest The,
is no penalty for contracting 10 take 25 p'
cent annually, and if the debtor voluntaril
pays it, all is right. But if he refuses tofu
I'll his stipulation, the creditor gets no al
from the legal tribunals to collect moro tha
Elk per cent This is tacitly perlnittir
usury, though givssit no legal countsnan
and support Such law would conform
the present practice of lenders and borroy
ers. Il operates simply rs repeal of Il
penalty against usury, which makes that
local crime which the common SenSe
right in the community tolcrates and Just
hes.