The Middlebury register. [volume] (Middlebury, Vt.) 1850-1882, 1869-06-08
Usurv Laws.


y see that the interest question is exciting
: SO much attention among your readers,
!. Earnest and candid discussion will certain
ly lead to more just and enlightened views.
Let us lay aside all sarcasm and personal
taunts. You, Mr.. Editor, cannot afford room
for such rubbish ard nothing obscures
; Q, badly our sight of the real truth in a
discussion Of this character. Let US look
: this great subject in the face, calmly and
: impartally.
The gentleman, who signs himself tx.
Y. u - asks us to decide what should he
the legalized rate ofinterest at the present
time. We hold that no fixed rates can
DO determined on. No limit to the rate
Of interest should be established by law,
except in case, where the parties have
not themselves agreed upon one. This
) is the position taken by nearly all eminent
modern writers on Political Economy.
We beg leave to offer the following rea.
sons why the matter of interest should not
be interfered with by law.
| !. If let alone by legislation, it will be
self regulating. This point has been al-
ready insisted upon in your columns by
other writers. The law Of supply and
demand will determine the just value Of
money, as it does it in the case Of other
articles Of business transaction. One
money-lender could not then ask more
than is fair, because, if lie should, bor-
rowers would 60 elsewhere.
The happy working of this system in
, Massachusetts, has been referred to. But
the experiment has been tried long and
successfully on a still grander scale. The
greatest commercial nation in the world,
, Great Britain, has repealed all usury laws,
u. to the perfect satisfaction of the commu-
nifty, The system of selfregulation is
c then not merely one which appears plaus
sible in theory, but one which has worked
D admirably in practice.
; 2. The matter of interest should not be
, interfered with by State legislation, be-
g cause the just rates ofinterest in one state
s depend upon the rates in other states
This principle seems to have been over
. looked in the last paper of OK. Y. H.
: The different parts of the country are so
o intimately linked. together by the ties oil
y commerce, that a scarcity Of money, or oil
-four or butter, in one section, and it,
consequent rise in price, produces cor
i. responding effect in other sections. Thus
e there is an equalization of prices all ovel
g the country. Of course there are distant
. places to which commerce and capita
x have not yet found an easy route. Blu
e in those sections, between which there IL
II convenient commercial intercourse, prices
, and rates Of interest rise and fall together
q The cost of loans in Boston does not, anC
10 indeed cannot, rise much above what it II
q in New York, any more than the oceaI
:. can rise higher in one of these ports thar
|, It does in the other. The reason is this
Borrowers of capital 60 wherever none.
e can be hired the cheapest, even though il
j. be hundreds of miles distant Our busi
!. ness men borrow in Boston or New York
10 when they can do better there than the,
OF can at home AMI Boston men will Dor
- row here if this is the cheapest market
a Hence, just rates Of interest cannot b'
much higher or lower in Vermont, thar
g. they are in Massachusetts, or New York
Bearing this fact IN mind we can Sc
40 the terrible confusion which is caused b,
u. the existence of different usury laws il
n adjoining states.
10 3. Rates Of interest cannot be justl
10 determined by law, because Of the una
voidable fuctuation in those rates from
- time to time, The value of circulating
-, capital varies from month to month an,
from year to year. The price of woo
d, tor the last ten years has ranged from 2
cts, to 81 90. All articles Of commerce
D. fuctuate in price in the same way. $
it is with money. According to CAREFUL
kept statistics, the rate of interest in til
, large money markets of the United State
IS from 1874 to 1858 varied from 81 to 81
L per cent. According to official report
= = the rate in England for the same tim
- varied from 2 to 10 per cent, In such
r. state of things, it is impossible to fix b
ed law, any rate which shall be just fror
o. year to year. If we fix upon the aver
age, which in this country from 1914 t
u 1858 was 1Ot per cent, 1t will one yea
all be unjust to the lender, and another yea
to equally unjust to the borrower.
40 4. Another reason why usury Law
re- should be abolished, is because of the
notorious inefficicncy. We all know thu
ar, 10 more than nine cases out of ten, wher