The workingman's advocate. [volume] (Chicago [Ill.]) 1864-1877, 1869-02-13

Money, the representative and measure of
value, has also the power to accumulate
value by interest. This ccumulative pow
er is essential to the existence Of money.
for no one will exchange productive prop
erty far money that does not represent pro
duction. The law making gold and silver
coins public tender, imparts to dead mas
ses Of metal, as it were, life and energy.
II gives them certain powers which, without
legal enactment, they could not possess,
and which enable their owner to 0Otain for
their use what 0ther men must earn by their
labor. One riece Of gold receives a legal
capability to earn for its owner, il a given
time. another piece of gold as large as
itself. Or, in other words, the legal power
Of money to accumulate by interest eompels
the borrower, in given period, determined
by the rate Of interest, TO mine and coin,
or procure, by the sale of bis labor or pro-
ducts, another lump Of gold as large as the
first, nd gave il, together with the first, to
the lender, If the borrower Of the gold
pay interest half yearly at the rate Of seven
per cent. per snnum, be must double the
lump in about ten years. Ii be pays inter-
est halF yearly at the rate Of six per cent.
per annum, be must double the lump in
less than tNeiye Years at three per cent,
N less than twenty-four years; and at one
per cent, in about seventy years.
In popular phrase, money is said to be a
producer Of value but this expression cen
yeys a false idea, for money possesses no
power 81 produce. The earth produces By
actual iHcrease-ty the growth Of addition
al quautil,- Of the seed sOwn. But money
possesses n0 Istural eapability TO produce
iLs lise. lt can only accumulate shings al
ready produced. Nleu a loan Of hun-
JTed dollars Il repaid With interest, the TX
or seven dollars given as interest haye not
grown upon the original one hundred.
Nothing grows upon the mortgage that bears
interest. The interest on the money, or on
thr mortgage, must be paid IN money re-
ceived IN < langes for -operty, products,
or ]. hor.
BE worth and amount Of the interest on
the dollar constitute and d-termtne the val
ue " the dollar, and make 1t equal to a Ger
tain amount If actual value OF properly, a.
much as tbe amount AID kind OF labor that
a man can perform determine hi- value az
W0rk mar; 9r as tbe quality and quantity Of
toe fIBit 0i q tree deterui ne ths value IL
the tree. ~ Toe same manner, ami for the
same reason. If the Interest Oh the dollar be
good, The dollar VII also be good. Tbr
value of the workman and Of he {, ee is
natural t0 them, aud consists ID I'll ir power
to produce; the yaiu, Of money is artificial,
aud consist III its arbitrary power to repre-
sent actual value ana TO accumulate By 10
terest
Demand ana supply are sometimes SAID 10
give value 10 money bat Il would be az
reas uable tt asSert that demand and sup
% tx the length # 'he yard, the weight
th l-T
that demand and supply regulate the value
of money. One is a egalinstrument to de-
termire value, hts own value being fixed By
law; the others are legal instruments to
determine length, weight, and quantity,
their own length, weight, and size being fix
90 oy Law.
Money IL valuable in proportion to its
power 10 accum .late value by interest.
dollar which can be loaned for twelve Der
cent. interest, il worth twice a. much a.
one that can be loaned for but six per cent,
Iust as 4 railroad stock tich will Annually
brBg il twelve Per cent, is worth twice as
mucn as cne that annually brings in six
per cent. The value Of state, bank, rail
road, er any otter stock, is st.t1ated by
,le dividends 1t viii Iay during the time it
has 70 run. Any increase or iiminutiOn Of
the power N money 70 accumulate BY intex.e
est, increases OF diminishes proportonably
It's Yaiue, aud consequently its power over
? 'pertY.
a. oey becomes worthless whenever L
ceases 90 be capable Of Accomplishing an in-
come which can be exchanged for articles
of actual value. Take the following exam
Tie. Suppose, during The Revolutionary
war, A. hau lent TO b. Thousand q lars 10
gold " silver coin, at six per cent. IL rest,
or q term az fly years, and tad taken Is
security mortgage on BIS f,rm. which
was worth @i0,0QV. A had az eed u l.-
ceive the six per cent. interest flom b. in
Continental moaey. Thi- currency soon
after proved Il be wor,aie>s and The in
terest proving worthless, the principal would
have been worthless to A. during the fifty
years for which be lent it, although the
loan was made 10 gold and silver coin, ard,
at The expiration Of that period, the prinei-
pal would have been paid him 10 coin.
Now reverse thu circumstances, and sup
pose A. had lent TO b. a thousand dollars in
Continental money on the same farm for
City years, and bad made the interest pay
allie in gold aud silver coin. Although the
principal was slent in Continental money
which soon after became worth SIS, it would
have continued as valuable 10 A for ffsy
wears. as the interest ia coin which he re-
eeived upon Il. Tue interest continuing
valuable, tie mortgage would have been
binding lien upon B.'s firm for the 6Fty
wears, and would have taken a part OF the
yearly produce Of the farm. for that period.
At tn expiration Of the fifty years, thr
Principal would have become worthless, flr
a. could no have brought in q further in
come. But 10 the former case, in which
specie wss lent and be interest made paya.
bic in Continental money, the interest be-
ing wort ess, the contract would not have
been an encumbrance upon BIS farm: for
no part OF its yearly products would have
been required TO pay the interest. At the
expiration q fifty years, the principal could
have been demanded in specie.
The value OF money as much depends up
on IL legal power to be loaned for an in
come, a. the value of a farm depends uuon
IL natural power to produce. II the Cont
mental money, or the assignats OF France.
had been made representatives of property.
and capable Of being alWay loaned FIR
good and uniform income, they would have
been a permanently valuable as mortgage
in perpetuity on a iarm, which could yearly
collect from the farmer u certain quantity
of products, as interest, or income The
.alnc Of horse depends upon bis ability to
perform useful labor fer bis possessor and
the value Of money depends upon its capa-
bility 10 earn for its owner by beng loaned
or interest Take twenty mortgages Tor ten
years on twenty different farms. Suppose
each of these farms TO rent for sixty dollars
a year, just the interest on each Of the
mortgages Il would take the whole pro-
duce Of each farm TO pay the interest on