Alexandria gazette. [volume] (Alexandria, D.C.) 1834-1974, 1871-01-18
The Rate OfIntercSt.


To the Editor Of the -4lerondrn Ga7ctte:
Please publish the following extract from the
Valley Virginian in the Gazette. General At
tention is being awakened to this subject and the
farmer are beginning to be satisfied, that what
was supposed would he beneficial to them is
now contributing to their great injury. Those
who advocated the measure tmany of them see
the mistake, when applied 10 :. peope stllal-
ed as the farmers of Virginia are. may fol
low up this matter in a short time. Yours
\ FARMER.
Buckingham Co. Va. Jan II.
We regard it as incontestably TRUE that the
experience Of Virginia within the last T.
months. has satisfied every rchectin" mind
thar the L. per ct. interest clau<e in the Con
Stitution is i great public wrong Instead Of
the ample influx Of capital Ia the State. iron!
the adoption Of that clause, that was predicted.
and consequent diffusion Of the controlling
agent of business throughout the State. money
is absolutely more difficult to be had. trade
seems more stagnaut. and the general face OF
all kinds of business wears more gloomy and
forloru apprarance Indeed We may assume it
nity can with impunity pay more than e per
cent. If that The operation Of the y per cent.
law must result in injury both 10 the ienderand
the borrower The money Is lei out at II per
cent on first mortgage on land for five years.
Of course it is utterly impossible for the farm
err or land owner to pay that rate OF Interest
from the proceeds of the land. By eXtraordi
nary shifts and sacrifices Of personal property.
the annual interest may be paid up: but when
the time arrives for the liquidation Of the prin-
cipal it will be found. in nine cases out of ten.
that the mortgage will have to be torecIosed.
the land sold at sacrifice ard the holder of
the lien become the purchaser Here the
transaction becomes disastrous to the borrower.
and the lender gets 4 piece OF property for
which he has no Use and upon which he cannot
realize per ct. and his means tied up. \
true financial economist would rather have his
money out a; six per cent. which might by
energy and judgment. be met by the farmer
out OF his land: than to let it out at - per CT
where there is no possibility of it being made.
The operation OF the law has been to prevent
desirable emigration to and investments in the
Valley and the State The attractive high
sounding tune of twelve per CT. has charmed
the speculative element. which eXiStSt in al
most every man. of those who had funds to in
vest, and instead, of putting their means in
lands and coming among us to reside. theyhaTe
preferred to let the money out at this ruinous
rate of interest: with mortgage security The
injury has been two-told-depriving us of des-
rable citizens and initiating the final step to in
dividual bankruptcy. There are parties whose
operations outside of their farming may enable
them to carry this enormous interest with lnl-
punity But they are the exceptions. Not
one land owner out of hundred can do it,
The - per CT law not only induces partic:
not to invest in lands in our State. but it is an
efectual bar to the operations of every farmer
whose necessities may require an occasional
loan. but who does not wish to invade or dis
trub his permanent real investments. He cam
not afford to pay this exhorbitant interest If
he borrows at this rate, his business will not
allow it, and if he does not borrow, his personal
property must be sacrificed for capitalists will
enforce their six per cent claims in order that
they may realize from their surplus the - per
CT 1t is natural that they should do so. for
every man wishes to obtain rs large revenue
from his capital as the utmost limits of the law
will justify.
In short. every observing business man must
see and feel that the result of the - per CT
interest law is working diSaStrouSly to the
farming and aboring community. which. after
all. Is lHC sure anu SteiulaSl -ulSlS OF all our
business operations. Some commercial COM
munites may derive an ephemeral advantage
from the operation of the law, but it cannot but
be transitory. for where the great source of all
legitimate business is oppresSed-where the
fountain of ali prosperous trade is stagnated-
the farming and laboring interests-it follows
as an inexorable consequence that no branch Of
business can be really healthy and permanently
prosperous,
The - per ct. may enable men to hold at
bay for time the wolf at the door, but as GER
tain as effect follows cauSc-as the laws OF trade
govern the results of trade-the final wind up
will be disastrous to ninety-nine ont of every
hundred who avail themselves Of the cxpe-
dent
1t operates against investments in lands
and every branch of business
that contributes to the substantial growth of
the State Our mineral deposits must lie
buried in the bosom of the mountains our
vast water power remain unutilized our tim
Der stand where nature placed it ; our lands be-
come unproductive for want of means TO apply
short. the whole financial re-
source Of the county must be brought to Il
condition III Stagnation and FERTILIZATION. -
Valley lIrqiniun.