Spirit of Jefferson. [volume] (Charles Town, Va. [W. Va.]) 1844-1948, 1869-01-26
tFor the Spirit of Jefferson ]
The Usury Law.
Eaitor of tie Spirit Of Jefcrson

the !act that thlS same experiment haQ Deen
made in Indiana, Wisconsin and New York,
and had failed entirely of any good to the
people in fact was accompanied with such
ruin to them, and produced such disasters,
that the people demanded relief from the ex-
tortioners, aud it was found absolutely neces-
sary to re.cnact laws against usurers, and it
was done. l send you, for the present, the
copy of letter Of W. w. Wick, formerly
member of Congress from Indiana, and from
which the people will be able to see what is
in store for them whenever this experiment
is tested on them. This letter is copied from
exhibits and documents sent with his mes
sage by Governor Wise to the Legislature of
Virginia, December 7th, 1857, and when the
Legislature of Virginia, it was supposed, was
about to repeal the usury laws. Knowing
that the experiment had been made in In
diana, Gov. Wise wrote to Mr.. Wick-who,
besides having been member OF Congress, had
also been on the bench in his State-to know
the result of the experiment. His reply is
in the following letter:
"WAsHINGToN, D. c., March Z, 1919.
Sir Your note of enquiry is before
me- | propose leaving for home this eve-
ming, and my response must be brief
sin Indiana, the usury laws were repealed
twelve or fourteen years ago-perhaps more
and were not re-instated for three or four
years. The frghtful results of the repeal
were not Immediately developed. Many
''stricken deer" retired to die in secret, too
proud TO make known his ruin, induced by
his over imprudcncc and the absence of legal
protection against it. Many were sold out of
house and home, ere public attention was di>
rectcd to the ubject but no sooner had the
effects Of the repeal been developed and be-
come the subject of public discussion and
conversation, than an irresistible public opi1e-
ion culled for uSu'y lars. The first step was
to fix the rate of legal interest at six per cent,
and to sanction contracts at ten per cent
In two or three years the taking more than
six per cent was prohibited.
{" If had time | would be glad to make a
sketch of the desolations left in the track of
the usurcr, during his brief reign in "Hoosicr
land" l was judge Of one Of our circuit
courts at tic time, and was Shudtte|ing 'C't-
ness to these desolaticns. [ have rendered
judgment upon contracts for the payment OF
80 or 20 cents per day, per week, for
loan OF $50 or 800, and in some instances the
interest had become more than ten times the
amount Of the principal. 1t is worthy of re-
mark that the usurer rarely brought suit for
his money until the accEmuating interest had
swelcd the debt to an amount approxlmatlng
closely the value of the debtors estate, or un-
til notified to do so by the surety or cndorscr
of the debtor. The usurer, in the meantime,
counted and gloatcd over his daily or weekly
accumulation Of interest, and the debtor (pOor
fellow lived upon the hope of extrication
through some miraculous intervention. | am
convinced that in some instances they had Il
secret faith that the creditor could not find
it in his heart to demand the entire sum le
gaIly due, or relied upon private assurances
from the creditor to that effect.
sIIad the Legislature not intcrlcred and
tied the hands of the spoier, an immense
amount Of property would have changed
hands in few years. As it was, clerks in
stores, venders of spirits by retail, &c, i'll
many instances, became wealthy, almost with
out capital of their own or by the use, at
limited interest. of the money of some
friend, who knew them well, and could watch
over their operations; and to make them
wealthy. n great number of small farmers
owning in fee land worth five to fifteen hun>
dred dollars were ruined. In many instan-
ces the ruin had not half done its work when
the estate of the borrower was engulphed-
Discouraged, shamed and indignant, he either
fed to dissipation, or became q man later
1 know many men of natural qualities, and
much inclined to be moral and gay, who be-
came hopelessly demoralized and mlsanthrop~
ical The moral deUdStGtiOnS created by the
absence Of usury laws will tell upon any com
munity to an extent almost infinitely beyond
the mere ruin Of estate.
"To show that it is not best to repeal usury
laws as an experiment, it is cnly necessary to
say that the contracts made in one year OF
the absence of such laws would not naturally
develope their consequences during that year
to any extent. As years pass away, the evil
results will dcvclope themselves in geOmet-
rical ratio. Long before they develope their
full force and effects, the community will de-
n,qnd us,uy lars, and the blighting curses of
many a withered or aching heart will follow
the advocates of their repeal to their graves.
In haste, yours truly,
W. W. WICK"
Wisconsin, too, had repealed her usury
laws in 1919, and the Governor wrote let
ter to her Senator-United States Senator
J,P. Walker to learn the result. His reply
is dated Washington, January "a, 1850, and
in the extract given by the Governor, he
saws in speaking of the repeal:
1.-The argument in favor Of this policy was,
that competition in the loan of money, the
rate OF interest being unrestricted, would
produce great influx Of capital to the State.
f certainly has produced an influx of money,
but not of capital. The result is (and is to
beI that money has been freely taken at an
interest from twenty to fifty per cent. The
money loaned was that of non-resldents Now
taking the average of interest to be twenty
five ner cent. it is obvious that, at the end OF
fonr wears, the amount loaned in the State will
apain be sent out and that, too, with an
equal amount for the interest.
"This is poor way, in my opinion, TO IN,