The workingman's advocate. [volume] (Chicago [Ill.]) 1864-1877, 1873-09-20
UsURY.

money Judge Hoedly Ia, pernApa, the
ablest defender Of the gold base fAllacy in
the Convention, and in the discussion to
which We refer, set forth all the reasons
that can be urged in favor Of money
that chinks;" and We think that any careful
reader must concede that General Ewing
not only has the best Of the argument, but
that Judge Hoadly, himself, has demon
strated the fallacy of his gold money. He
admits that the rate Of interest bears q
direct relation TO the volume Of currency
One hundred thousand dollars could not
be loaned for six per cent, but under the
old State Banking System it was the basis of
two hundred thousand dollars in paper
money, whereby the banker received eigh-
teen thousand dollars, and the borrower
paid only SIX per cent.
Thus by an increase in the volume
of currency the rate of interest was
kept down to six per cent. The Judge
seems very properly to condemn this
old system Of a gold reserve Of one
dollar tor every two of paper money issued
by the banks, because, when public conf
dence was gone there was nothing left to
give value TO the paper money, over and
above its fractional gold base. But what
then Why there should be no money
that does not : chink through the intersti-
ces Of the purse. But a money exclu-
sively Of this kind, Judge Hoadly i'm
phedly admits, could not be loaned at a
low rate of interest, and yet he wants only
this kind of money And then he wants
the usury law repealed so that its value b.
left to be regulated by supply and demand
One would suppose from reading sueh
arguments that high rates of interest are
the chief public good, in the opinion Of
Judge Hoadly. Government has no power
10 make money, says the Judge; no power
to regulate its value. Now, we say the
value Of money depends upon the rate of
interest, and the Judge admitted that three
hundred thousand dollars could be loaned
for proporrionally lower rate Of interest
than one hundred thousand dollars 90
that legislation, which makes money
abundant does lower the rate of interest,
and lowering the rate Of interest does reg
ulate the value Of money ami, therefore,
Government can and does regulate the
value Of money, notwithstanding Judge
Hoadly
There is another notion the Judge en-
tertains which dehes experience and COM
mon sense. 1t is that the buying and
selling of the nation can be effected by a
transfer of credits and accounts on the
books of the bankers. Ii really seems
that any man, III the light of every day
experience, who can soberly maintain the
suthciency of system of credits and
transfer Of accounts to effect the purchase,
shipment and exchange of the present
wheat crop alone. Of the nation, Is filter
for an insane asylum than for State Con-
stitutional Convention This heavy sys-
TEN Of credits exists to-day. Every man
may now avail himself Of all the efficacy
that exists in transfers Of accounts. And
in addition to all this transfer Of credit,
which Judge Headly thinks is the only
thing necessary for the commercial ActIvi-
ties of the country, there are over seven
hundred millions of paper money In circu-
'IatIon, -at tire financial colpmDAsa6f4H
the newspapers, the statements of all the
bankers in all large cities are, to the effect,
that the money sent among the western
farmers iif4,aymans sk.:----Spm has
made an.unavoidable stringency in all the
centers of capital. embarrassing merchants
and business men to that extent, and 30
aiding the Shylocks and money mongers in
their usurious eItortions, That the usury
laws are entirely disregarded. And right
here is found the reason of the ineficiency
and practical abandonment of the usury
laws THERE'S not sufficient amount of money
to meet the demands Of business, and the
credit Of merchants must be maintained,
their bills must be paid when due, the de-
mand is beyond the supply. hence the ex-
tortional rates Of interest which business
men are forced to pay. They cannot get
the money at legal rates; they must, there
fore, pay what the money-lender demands.
But the swindle of this sounding phrase
of supply and demand, in reference to
money, is that the supply is always made
quate, and with gold and silver only a.
money can never be adequate to meet
the demands of commerce and, therefore,
extortion and usury are inseparabls from
the exclusive use of the money that
chinks"
When a rational monetary system shall
have been adopted, when the national
credit shall be- used to make exchanges, in
stead Of that individual credit, transferred
on bank books, Of which Judge Hoadly
speaks, then the supply Of money will
regulate itself by the demand, and there
will be no need Of usury laws. The chief
value Of money, in the opinion Of Judge
Hosdiy. is it's scarcity. The products Of
the mines are increasing the quantity Of
:" the chinking money" from one hundred
to one hundred and eighty millions
annually, and thereby constantly diminish
ing the purchasing power of this money.
1t is the alleged diminishing purchasing
power of grsenbacks which HnGts them for
money But Judge Hoadly says the same
effect is happening to "the
money that chinks." We suggest an act Of
Congress to stop all the mines, and il need
be, to punish all miners who will insist
upon diminishing the value of our money
by their labor.
Judga Haadlv sneaka Of tina larrar amnae