Delaware gazette. [volume] (Delaware, Ohio) 1855-1886, 1869-02-26
From the n. I. Indepenul
Rates of Interest.

Let US suppose fifty men at the age OF
twenty-one, each one of whom is worth
$40, GOO. Tneir aggre gate wealth - $500,
600. They loan this sum to fifty other,
annum, who use the money for the pur-
poses of business. AS fast as the interest
becomes due, they loan il also to the
same borrowers and this process they
continue for forty years and four
months. At the end of this period, the
borrowers are called upon to piy the
original principal and all the accruing
interest. What is the amount they
will have to pay ? In the first place
they must return the principal of $780,
600 !; and, in addition to this, they must
pay 81, 5000, 900 as the interest accumu-
lating upon this principal-thus making
each of the lenders worth $3.50, 900 at the
age of sixty-oDe years and four months.
Can the fifty borrowers do this, and yet
have anything left to represent the ac-
cumulation of their labor in the use of
borrowed CapitRl2 We very much
doubt whether they would be able to
pay their debts. What they gain by
the labor of forty years and four months
is simply their own living; and this
they could have gained by, the same
amount of Dor without using borrow
ed capital. IF we suppose the ltndeIS to
support themselves by their own labor,
then, when the account is settled they are
rich men and the borrower q and acsli-
al producers of their wealth, who have
labored for the same period, are poor.
The same result would ensue, if we
suppose the first fifty men to own fifty
farms, each worth $4,000, which they
rent to the second fifty, with the under
standing that each of these farms is to
double itself in every ten years and one
month. and that every added FORM is to
do the same thing, until the eXptra ton
of forty years and four months. Then
the first fifty farms are to be returned to
their owners f; and 750 more farms are
also to be transferred to these owners
as the accumulation by rent. How
many farms win the fifty lessees have
| left after meeting the claims of the fifty
lessons? Is there any system Of agri-
cultural production than can endure
such rate of rent for the use of land
must be followed by the same result,
whatever may be the kind Of property
TO which it applies, whether it be land
or houses, or money.
The real cause that lies at the bottom
of this result consists in the simple fact
that the accumulation of property as
the fruit of labor applied to borrowed
capital is not proportioDate to the ae-
cumulation Of money when loaned at
the rate of seven per cent. per annum.
! No kind of labor can afford, in the long
run, to pay so high rate of interest.
It gives too great an advantage 10 the
lenders in proportion to the advanta geS
enjoyed by the producing classes. It
makes money too dear for the best good
of the greatest number Of persons, and
tends largely to the accumulation of
wealth in the hands of the few. We have
no hostility to capital or capitalists /;
yet, in our Judgment, the average rates
of interest in this country ought to De
very materially reduced. The present
rates as fixed by law, constitute n Verv
serious evil in our H3o1efarS system.
They embRrFass business whilF they
oYertax labor. --e.
It is more and more evident, day by
day, that the Government is paying far
too much for the use of money /; and we
do not hesitate SO say that our whole
national debt could, under skillful
management, be funded at Jour per
cent. interest. But it can never be done
by any laundering process contempIa-
ting a reduction of our currency and
the curtaling of business.