Middletown transcript., 1868-03-28
publit affairs.
The Credit system.


Personal CRED1Ts.-Thcre is an OBJ
vious distinction between credits for arti-
cles for personal and family consumption,
and credits for Articles upon which the
debtor trades. In the former case, the
article purchased, as SON as it is
| is put to use, is either consumed, or
so altered in value, that for all purposes
of trade it may be considered as property
annihlated The credit in such cases has;
no basis, because the property upon which
it should rest is no longer in existence.
But articles purchased on time, to be re-
sold, are eith,r in existence, or their equi-
valent is Credits for such articles are
based on existing property. But credits
for articles for personal consumption are
based on nothing.
No man or woman, therefore, has a
moral right, either to cat, drink or woar
any article for which they have not paid
the money, or which they have not earned,
by rendering an equivalent of labor. For
what right has any person to enjoy that
which he has neither earned or paid for?
\ purpose to pay for feed or clothing, or
an expectation, which may be disappoin-
|
stitute such right. Nothing can give
moral right to enjoy the property of another
but the actual completion of the exchange,
by rendering for the commodity either
labor or money
Sound business principles, as well as the
interests Of the consumer, require, that
when goods pass out of the hand of the
retailer, they should only be sold for cash.
For the chief cause of the failure of
business men is the failure of individ-
uals who have purchased for personal
consumption to pay their debts. The re-
taller buys on time, and sells on credit.
When his paper natures, he finds in his
possession a number of accounts against
various parties, all of which may be re-
gardcd as good, but of which he is only
able to realize part. He is compelled to
ask for an extension; his credit suffers, so
that he is not able to buy on as favorable
terms as heretofore.
The failure OF retail dealers occasions
trouble and pcrplexity to the wholesale
dealer and importer. He does not only
fail to realize the gain of exchange, which
was based on the supposition of settle
ment at the time agreed, but he finds him
self in possession neither of his goods nor
their value; and besieged by petitions for
extensions, or offers to go into liquidation !:
|, petitions and offers which, however he
may meet them, he is obliged to re-echo
with chagrin and humiliation, to those
who trusted him. The failure of the pur-
chaser for personal consumption, is felt
like an electric shock by every party,
through whose hands the property has
passed the paralyzing effect of which in
creascs as the sources of distribution are
reached in the wholesale dealer and i'm
porter.
Thus as credit produces credit, so insol-
vency produces insolvency. And the
source ofthe mercantile embarrassment and
finical ruin, which appear to come so sud
denly and uncaused, is always the failure
of consumers to pay their debts promptly
t The interests of the consumer, likewise
, require that he should never take credit
for articles which are purchased for his
own personal or family consumption. The
consumer, who buys on credit, pays not
only for the goods he purchases, but he
, pays for the credit also; something which
can be put to no use, but which has to be
paid for as though it had. Its cost to him
over and above the price charged to the
man who pays cash, is from ten to twenty
five, or even fifty per cent, varying with
the necessities of the debtor. And after
he has opened an account, even if the
article is not exactly what is required YET
there are influences ut work, which com.
pei him to take it. He fears that credit
when he again desires it, may be refused
| or that the creditor may become inconve
niently urgent for settlement of his ac
count. As the time passes when his ac
counts should have been settled, he finds
, himself almost unconsciously, at first
; avoiding passing by the stores where he i.
in debt. He is gradually losing his man
linesss. Of two ways to business, or ar
appointment, he chooses that, in wich ht
is least likely to meet his creditors AL
e this he feels the more, the more conscien
l tious he is. If he never intends or ex,
poets to pay, he may feel no thraldom from
debt But an honest man i'll debt, with
, his income absorbed by current expenses
t and his home or farm, if he owns one
mortgaged to his creditor, is under shad
= ow, which the brightest day cannot dis
e sipate.
Sometimes man has reached this po
sition by yielding to the temptations to ex
y travagance offered by the facility of OBJ
tanning credit. Articles are purchased b,
t himself or family both of kind, and il
amounts, which would not be purchased i
they were paid for at the time. 1t is S,
easy for people to believe what they wish
I a II
to meet the obligations they incur, ant
therefore they crafty their present de
sires. Especially is this temptation to ex
travagance irresistible, where the debto
g has nothing to lose; or where there is nj
stain, as is the case in this country, at
: taching to insolvency.