Belmont chronicle. [volume] (St. Clairsville, Ohio) 1855-1973, 1858-02-25
To the Editor of the Belmont Chronicle:

, lag hele 10 compete Win MIN 1Or q lev
r months, and deters muck of it from enter
ing the State al all. If the Constitution
prohibited legislation on the subject of in
%terest, it probably never would rise abov,
eight per cent. because of the competition
J of lenders. Hence lenders, not the moder
ate ones, out the extrem, shar pers, are tn,
real fathers OF usury laws. They wish I,
exclude the people at large from competing
with them in the money market. Wei
knowing that wants will exist whose graft
fcation must be governed by the law o
supply and demand, and that nothing car
reduce prices but q plentiful supply. TIC
prevent this supply has ever been the CD.
ject of sharPers, and they have used the
praiudices OF the ~thoughtless to effect their
object. The lewd, co%ck-fghting, horse
racing parsons and Profiga;e lords of Eng
land, whose prodigal habits force them to
borrow in anticipation of income, have
modestly claimed to fix the price at which
the industrial, more moral, and frugal class
es should lend it. But in spite of severe
usury laws we see The price of money quo
ted in business centres at enc, two and
three per cent. per month. The severer
the law the higher the interest ascends;
because the mass OF the people are kept
out of the market from respect to the law.
while a wise few do the lending, selecting
for borrowers men of sense; men who would
as soon think of stealing the grave clothes
from a corpse as attempting to plead usury.
These few are much tempted, if they have
influence over Banks, 10 borrow largely
at bank interest in order to lend again at
higher rates OF interest; and | have heard
them accused of seeking by usury laws, to
into bank stock in order that they (the said
wise few might get the handling OF the
funds for their own purposes.
| can see no good reason why the people
should not be permitted to sell their money,
or rent or lend it, as they DO their houses
or horses. The fixing a value on ones
property by law is strikingly absurd; and is
like declaring by statute a dry ridge navi-
gable. The %re'atiOn Of demand and sup
ply determines the value OF the money; and
the amount of water the navigability Of the
ridge. Tha: all nations have had usury
laws shows tLat the few in all nations have
rode the many-'hat c~upidity is ever seek
ing to coRtrol the property of others for its
ownadvantage. Why not ct people a, large
lend their money directly for s. 9, 1907 any
other per cent., instead OF forcing them to
employ bankers to work out a per cent. for
them. Why deter foreign capital from en-
tering the State!
There was a time when Philadelphia had
a greater population than New York. In
spite of the ignorance and prejudices of the
times, George Clinton, or the statesmen OF
New York, well knowing that tus,nesS
rouId attend capital, cOntr;ved TO put inter-
est one per cent. higher than in the other
States. This soon carried New York ahead
of Philadelphia; and now more than one
hall Of the whole revenue Of the Dation is
collected IN New York city; showing her
great superiority in capital as well as pop
~ulation; and this superiority was mantle ST.
ed before her canal came into operation.
and as to her harbor i. Is no better than
some others on the coast.
In May, 1887, money was three per cent.
per month in New York, according to the
published quotations. In 1915 it was FIVE
pet cent. per year. A capable Judge in
lsuch31atters, doing business in that city,
told me that the price of money could not
have reached one per cent. per month in
1887 had i: not been for the usury law,
,,,I IL, 1-,ot ,ho r1p, ort IF tho marrat
and left it to the fen without competition.
The mang would not lend at seven per
cent. when it WINS worth more to buy goods
with at Sherif's sales, three-fourths Of
which sales might not have occurred if the
victims could have borrowed OF every and
any body, or if quack law had lot cut off
the chief arteries that supply the italiluid.
of business.
The law of demand and supply is a law
Of nature. and human laws cannot repeal it
more than they could make a river run up
stream. An obstruction could be placed in
the channel which would disturb the cur
rent, but it would still go on in SPITE
of the obstacle. Poor Pennsylvania
is just now waking up on this subject, while
New York is trying to keep ahead by pro-
posing to abolish all restrictions on the
trade in money.
When the bank of st. Clairsvillc was in
operation, it contained generally between
fl fly and sixty thousand dollars of deposit.
Knowing certain mer had deposits there, |
hage advised the applicant for a loan to cali
on these depositors. The applicant returned
! afterwards with the report that none of them
had money to lend, but that Mr., told
him he would get money for him, if he could
afford to pay 90 per cent. for it; and be had
agreed to give that per cent. On nv after
wards asking the depositors Why they re-
fused 10 lend: they said they would not lend
for six per cent; but I found they would have
loaned from s TO 10 per cent if there had
been no law to dodge in doing so. Thus I
have often seen borrowers obliged TO give
Is to 90 per cent. when I did not doubt
that some forty thousand dollars was lying
id'e, waiting for investment, and could have
been had at from s to 10 per cent. il there
had been 90 legal distractions in he wav.
Our worthy Governor would DO well to re-
investigate this subject. I perfectly remem-
Der my surprise, on first discovering that the
extreme usurers were the makers and sup
porters, as well as breakers Of usuer laws.
A series Of essays against these laws we've
published in 1914, in the Columbian. a news
paper of Pine street, New York Some four
or FIVE money lenders at high interest used
to frequent an office in which | was a clerk.
overheard them commenting on these es-
suys,-slys one; i tiose laws are repealed ,
interest will scarce rise above 8 per cent.
Yes, replies another, that e~ssavist ought to
b, answered. in short | found to my aston
ishment, that they wanted the usury law
continued in full fore. As soon as the head
of the office came In, | informed him of my
discovery. Oh, said he, they do no: want
competition more than the dry goods mer-
chants of Proadway,-alluding TO n remor
STRANGE they had appljed to him to write.