The workingman's advocate. [volume] (Chicago [Ill.]) 1864-1877, 1870-04-23
CHAPTER V.


fRx AMOUNT OF 4 CURRENCY SHOULD BE LIMITED
ONLY ny THE WANTS OF business.
Il is indispensable to the regulation OF
the currency that the amount Of money
sAossld be limited only By the coasts Of
business. Il has been already shown that
the value Of money is determined by its In
come, or rate of interest. .Thiz proposition
being established, it follows, that if the in
terest be regularly maintained, the amount
Of money may he unrestricted without de-
creasing it's value.
The following illustration will show.
that no laws against usury can prevent the
oppression and evil consequent upon limit
ed amount Of money.
Suppose one hundred thousand persons
forming nation to frame their own govern
mert and laws. They make gold and
silver coins the legal currency, and FIX the
rate of interest at six per cent Several
penalties are affixed to the exaction Of a
higher rate, and to the expectation OF money
from the country. This nation has in coin
$12 to each inhabitant probably as much
as any people, however wealthy, can keep
in active circulation. The specie in the
nation amounts to $1,2oO,0OO. Twenty
men become worth 100000 each, to-
gether 81, 900, 900. 0ne million is loaned
on bond and mortgage and business notes at
the legal rate. When all the money of the
nation is in active use, the twenty men deter
mine to call in thirty per cent. Of their
loans, and hold the money for week or a
month in order to make more profitable re-
investment. This takes out Of circulation
$500, 900, one-fourtb Of the whole circulat-
ing medium, and causes great scarcity oil
money. Onc-fourth Of the debts in the ma
ton lie over unpaid, for all the money was
before required to meet contracts. The
twenty men hold only their own money, and
no law can, or should compel them to use
it. They do not take more than the legal
rate Of interest. Let these men hold their
money for six months, until the unpaid
debts are mostly collected by suits at law,
and the twenty men and other owners Of
money can buy the property Of debtors at
less than half its value. All securities de-
PROBATE, and confidence is lost in the value
of property, and in the ability Of debtors to
discharge their obligations. Yet no money
leaves the country, nor is any change made
in the rate of interest.
Twelve hundred thousand dollars is an
abundance of money for population of a
hundred thousand persons. If we allow it
to pass from one individual to another three
times a week, (and money passes much
oftener in cities, the 81, 100000 would
pay IS, 6O0, 900 of debts every week, and
in a ysar $751;, 100000. Notwithstanding
this abundance, these few individuals can
easily affect the money market, and greatly
increase their wealth by purchasing pro
perty at reduced rates, and selling it when
the depression ceases. If the amount OF
money for each inhabitant were increased
to $40, the aggregate amount would be but
$4,000, 900, and the twenty men would be
worth as much as the whole currency of the
nation, and could easily keep enough in
their own possession to effect the same re-
suits. The government is powerless to
prevent these evils, for the amount Of
money is limited, and few individuals have
the control oft.
In the United States within few years,
in times Of scarcity Of money, cows were
sold at sheriff. sale at from 50 to IS; good
horses at from 50 to $40 and cultivated
lands for few cents an acre, when they
cost their owners nearly as many dollars.
When money became plenty again, these
cows, horses, and lands rose 10 perhaps
quite their former price. No nation should
fix upon a standard Of value Of limited
amount For limited amount of money,
even at a uniform interest, will enable the
owners of mouey to monopolize the pro-
perty of the nation.
The State of New York has a population
of $4,000 Multiply this by II, and we
have $4,000, 900, a much larger sum,
doubtless, than is kept in active circulation
in our State. Still, there are probably two
men in the State who are worth more than
this sum and who can, whenever they
choose, affect not only the money market
Of this State, but also that Of every State in
the Union. Neither the State government,
nor the General Government has power to
prevent it, nor to relieve the people.
TO BE CONTINUED.