Delaware state journal. [volume] (Wilmington, Del.) 1870-1883, 1873-02-22
INTEREST AND USURY.
Where Does the One Leave off and the
Other Begin THE Usury Question
Historically Considered.

Historically Considered
Ia late, number. the West Chester
Amerledn Republican appears communl
cation well worthy pcrusal, and which the
editor Of that paper say' Is fiom the pen
OF one OF the most practical and obser-
want men IN that community. The article
Is headed "lnterest-Usury," and is as
follows:
The meaning which we attach 10 the
d'st of These Words is precisely that
which, until comparatively recent period,
was attached 10 the last, that Is, the pre-
mlum paid, or stipulated 10 DO paid for the
use Of money. ln all natlons whose history
has eOme down 10 us, for period OF three
thousand years, the practice OF taking
Interest fJr money loaned Was universally
condemned as moral wrong, as a crime
against nature. This was the unanimous
sentiment Of all the, Pagan Philosophers,
OF all The Christian Fstherb, aud Of all the
Councils and Popes of the Catholic Church,
up to the time of the Reformation. John
Calvin was the very frst who opposed the
universal opinions of mankind upon this
subject, maintaining that uspry was not
wrong except. when u was e1aeted IA an
oppressive manner from the poor nor
would he consent to have any law enacted
In Geneva 10 cheak II, declaring that the
common opinion received no support from
Holy Scriptures. The Reformation and
the revival Of ancient learning had glyeu
so great an impetus TO trade ard cummeree,
and the demand for iiiones Became ee
pressing 90 to compel the different natlous
Of Europe 10 modify their opinions. Cap
/ ttaitata t.yaro rn.a ullnsuad ~ lnat. al rataa
axed by the State. Though money-lend-
ing was permitted in England In the reign
of Henry VIII, the fret statute enacted
by Parliament was Il James l, which fixed
the rate Of interest at per cent. Under
the Common wealth the rate fixed at q, and
by act Of ~ Ann, II was r. duced 10 live, at
which rate It stood until 1889, when all
laws on the subject were revealed. Since
then, money, like any other arilcls Of
barter or trade, Is leil TO be fixed by the
common laws Of demand or supply. If
no rate Is specified, III All ordinary agree
ment, no interest can be collected by the
lender.
Is 1t not strange, then, that In this age
when political economy has been raised to
Il science, we should remain fifty years
behind the English people, still immersed
in the mlsts and clouds of the dark ages
We know that In a State where great
works Ofindustry or utility are carried on,
immense sums will be borrowed at inter-
est, and that such transactions are equally
advantageous 20 the borrower and the
lender. We know, too, that the premium
paid for the use Of money is not caprclous
n amount, but Is governed W certain
well known laws winch no Legislature
can change. This premium or rate Of in
lerest usually consists of two elements
the price or market value OF the money,
and the risks. But the price or value Of
the money is determined as we have seen,
like the price Of any other commodity, by
the law of demand and supply. 1t de
pends upon the amount of money that is
to be lent and the demands Of borrowers
or in other words, by the amount ol
veal: n seeking investment in a country
and the amount OF enterprise,
If, then, when the law Of supply and
demand has regulated the rate of interest,
the State iuierposes and endeayors TO fix
the rate at less sum than the money will
command in an adjacent country, IL Il
easy to see what must be the conseq fence
The capitalist will certainly not lend, ia
ordinary circumstances, at home, at Il
rate lower than the market value, nor in d
manner witch will expose him TO lega
penalties. Hence mon y Will begiu tt
lloN into other Stats where the laws &c
uot Interfere between the borrower ant
lender, or where higher rate is autL or
ICED and where the demand is greater
But borrowers here must have money o
I close up thrir suancs-.
! Ttey therefor. call In middle class
known as agents, money chat gers O
. brokers, to nego late between the partiC
! | ID hst 1af frhma lac hr t.,
I Of useless and abortiye law the most de
serving class of inen Ia the community
! the men Of brains, Cnorgy and skill II
brown Tito the hands Of men often with
out capital, character or conscience, VIII
! make their demands on the borrower grca
In proportion to bis necessities, and tn
; furtive character gwen w the trausactio
is eminently favorable to imposition.
Z rate of interest Is therefore demanded an
1 paid which money never would comman
but for the existence of this useless an
I hurtful law. Nor is the capitalist con
Y monty the gamer. He receives but mod
} crate rate for the use of his money Will
e the balance goes into the hands of IA
rapacious middleman, who exacts enOi
] nous sums under the name of Z" bonus.
? Many unwilling to submit to SO gre
sacrifice, put their paper on the marke
y and sell il for what il will bring.
SO that when State attempts to fix th
S rate of interest ut sum less than th
= actual value Of the money, Il inlrodue,
confusion into our monetary affairs, lead
T TO all kinds of evasions, and invariab.
T. raises the rate above what il would be
I no law existed on the subject. This ha
o been demonstrated again and again /
) France, Russia and ether countries. A
e experience proves that a State can n
more regulate the price of money than
= can regulate the price of horses or whea
This is done by higher law, which bid
y defiance TO human enactmeuts. These il
u terest laws are the abortiye relics of
harharOus age. In our great centers {
business they are utterly disregard hl
h still their very existence eOmpels all class
!, to adopt some roundabout and expensiy
process of evasion, which expense Is inv
!, riably thrown upon the borrower. So the
d we are driven to the conclusion that an
a attempt to dictate by law the terms @
Q which man may lend his money, is a
u infringement Of the common rights Of maj
d and will ever prove delusiye AID abortiy
We write, not In favor of retired cap
:, ialists, for they can under any circun
Il stances in civilized State, take caro-
y themselves but in favor of energeti
'e must borrow, and who, as a last resort, Al
driven by our law to the brokers' ollie
II Were II not for the ignorant and unju
~ enactments Of the State there would
Ie comparatively little conflict between Gu
o ital and labor the one is essential to Il
d other, and they would work harmonious
= if allowed to work freely. Let us hop
ID then, that the time is not FAR distant wh'
our Legislature, after the example Of En-
land, will sweep from our statutes ever
thing relating to interest, leaving, as
-. all other cases, the parties fee TO nal
- such contracts as they can agree upO
- and If no rate of compensation is specific
81 in such agreement then no interest cou
D be collected by the lender, except by q
- awaid Of a jury, who, having all tie c
W cumstanoes of the case before them, cou
. give what justice and equity would see
to demand. s.
ii. A Cheerful ClYer.