Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1871-12-07
FARM AND GARDEN.
UsUKY LAWS AS THEY AFFECT
FARMERS.


such an erroneous method of thinking OF
the subjea that we propose in this article tc
show in what manner the small class o.
farmers are affected by it, and how much
they would be benefited by repeating all
usury laws.
We are aware that there are many per-
sons who will receive no greater rate fol
money than six per cent, believing that
they are guilty of violating a sacred
law, but the more enlightened bib
ical scholars .low believe that
the question of usury related to the Je WIS
as only between themselves and no refer
ence is had to persons of other rationale
ties. To take any interest was as between
Jews usury: the rate having nothing to do
with it. Three or four per cent.was as much
against the Jewish law as ten or twenty.
So much as to the religious aspect of the
Usury Laws. We hold that no rate of in
terest should be fixed by law, and that
when Legislatures do so they virtually put
the small capitalists at the mercy of larger
corporations. Can any reason be assigned
why these moneyed corporations may lend
money out at ten, fifteen or even twenty
per cent. and private individuals are re-
stricted to six, or by special contract to ten.
Why is money any more than flour, or to-
bacco, or cotton, limited in price? A citi-
zen should have precisely the same right to
the market price of his money that he has
to the market price Of his house; and the
right to fix the price of one infers the right
to fix the price of the other. If good rea-
son can be given for fixing the price of
money, the same reason will apply with
even greater force for putting price on
farms or live stock; because money is sub
ject to greater and more sudden changes
than property, and more elements enter into
an estimate of its value. There are the
of risk and of easy and quick
smissibility-scarcely appreciate guam
titles in the estimate of the value of other
they become of leading import
ance in the determination of the value of
money. Use only, ultimately governs the
value of most other products, and their
market value rises and falls more leisurely;
but owing to the Geographic swiftness with
which money is moved market may be
scarce to-day and glutted tomorrow.
There is greater reason, therefore, why the
price of other property should be fixed by
law than the price of money.
This law as now enforced virtually re-
stricts only the price of money belonging to
private individuals. If it is contrary to
good morals, to enlightened policy or to the
security of he State for private capital to
yell for a higher rate than six or ten per
cent why do not the higher rates de-
handed and obtained by banking corpora
ions offend public morals, endanger the
safety of the State or run counter to en-
ightened craftsmanship? Suppose any one
wishes to borrow thousand dollars. His
banker tells him he has no money to lend,
out that he viii buy bills drawn on New
Y ork, or any other place beyond the limits
IF the State. And so a bill is drawn on a real or
imaginary firm in New York; imaginably
shipped to New York; accepted by a real or
imaginary firm; remains by fiction in New
ork for sixty or ninety days and returned
o his banker in imagination for collection.
During all this time it perhaps has not left
he counter upon which it was drawn, yet
or this trouble it can command by three
,er cent. higher rates than is allowed to
private individuals, and in practice they
,ften get much more. The banks are not
o blame for using this power. 1t is legiti-
nately theirs, and it should belong to every
me.
But these transactions work a greater
hardship than would at first sight appear.
The small capitalist cannot buy bills or en-
yage in other banking privileges because he
5 not licensed to do so; and a license to do
10, would cost more than the amount Of
lis capital. He cannot lend his money at
ates that viii pay as much as investments
II bonds, stocks and other securities.
investments in this manner retire
arge sums from the business of the
country and make money scarce. Banking
taking advantage of this scare
ty and the pressing demands for money
aise the rates to the highest point allowed
hem, and so become powerful engines of |
to very numerous but unfortun-
tie class in the country. But for the infu-
nee of the Usury laws money under such
circumstances would flow in from other
POINTS at reasonable rates and thus relieve
he debtor class.
1t is often urged as an argument against |
he repeal of the usury laws, that if money
5 not limited in price, the rate of interest |
will be so high as to be oppressive to the |
lebtor class, and we heard this argument |
lsed in the Legislature. This argument is |
more plausible than sound. If money is |
worth more than the rate fixed by law, it |
will not be loaned, but invested in some |
BUSINESS that will pay better than lending it.
The supply in market is thereby diminished, |
nd the probability of relief to the
ebtor more remote. If it is worth |
ess than the rate fixed by law the borrower
viii take advantage of the supply and buy
at a less rate. Manifestly then the fixing
f the rate of interest cannot benefit either
he debtor class, or the money lender
These usury laws are dead letter upon
he statute books; and the only effect they
ave is to keep out Of the market the small
unls owned by the poor, but thrifty class
f the country, and to increase the profits
f great moneyed corporations. Let these
elics Of barbarous age be swept away.
hey are a disgrace to the common sense and
Utilization of the American people. Fos-
cred and kept alive by farmers and other
mall capitalists-the very class to whom
hey work the greatest iniury-every effort
hould be made to dispel the darkness in
'hich this subject is wrapped. If money
ould be sold for what it is worth, just as
ny other commodity, the price
7ould be regulated in a like man
er, by supply and demand, with