Public ledger. [volume] (Memphis, Tenn.) 1865-1893, 1877-01-09
rHE CoNYENr1ONAl INTEREST LAW.

THE CONNBNIAVN al NAhhGSA Ia"
The legal rate OF interest in this State
is six per cent, when no special contract
is made. Under the Constitution a law
was passed some years ago providing
that ten per cent. interest shall be legal
when specified on the face Of a note or
other agreement. Any rate from six to
ten is a conventional rate aEd may be
collected by law. An idea has grown
up in the minds Of the people
that this law is q s-.ate; that
it is unjust and the indirect u
in some degree Of hard times and
scarcity Of money. If the many we're
not borrowers it would be of little
concern 10 them what rate the lenders
were allowed to charge. Ia a normal
and healthy state Of affairs the farmers,
who produce almost everything in this
State tina. sells for money, would have
money in the chest or in bank to lend
to merchants, traders and others. In
stead of this, under a pernieious and
ruinous credit system, nine-tenths Of
them are in debt and are on the borrow
ing side. 1t will be an easy matter, if
the Legislature is so disposed, to repeal
the conventional interest law, but a
trial of the experiment will be
followed by the admission that it
did not relieve sny class, ard that it
drove capital from The State, or locked it
up in asfes, aud worked a real hardship
on those who we're in a position that
forced them to borrow on the terms die
tAted by bankers or c1rbstone brokers
No Law should be passed to favor or op
press any class, andnola Law can be passed
compelling individuals or corporations
to lend money at four, six, ten or any
other given rate Of interest. The helder
Of the money always has the advantage.
He can protect himself, law or no law.
This is human nature. and it is a rule
that has few exceptions. Those who i'm
sgine that the repeal of the ten per cent
conventional interest Law will enable
them to borrow at six per cent. will be
uaSeceived in due time. Again, no law
can be devised that will force capitalists
to invest in farming or otherwise de-
vsloping the of the State. The
very fact that those most largely and
numerously engaged in this line Of busi-
ness have been living beyond their in
come, aud are money borrowers, would
be enough to deter any business man in
the outset. We hope to see more and
better farming, and to hear the hum Of
manufactures, the roaring Of FORCES, and
the glad sound Of diversified industries.
But these great changes cannot be
brought about suddenly, and cerp inly
not BY the means now proposed as a pan
aces for hard times. The remedy les
within ourselves. We must frat reduce the
expenses Of State, county and municipal
government as low as consistent With the
responsibility and efficiency of the ser.
vice. Institute a system Of rigid economy
in public and private affairs; dispense
with all useless ofiees-lop of the dead
limbs so to speak; keep out Of debt; do
without Injuries and imported goods;
teach our children to work by setting the
example, live within our means and &C.
quire habits OF self-reliancs and a coE-
Sciousness Of independence. This policy
will bring certain relief. The Legislature
cannot put money in the people pockets
They can help themselves. We believe 10
free trade and sailors rights." Money,
like everything else, should bring whRtit
is worth 10 the market. II a farmer
drives a hundred dollar mule or horse to
town aud can sell it fer one hundred and
ten. it is right to do SO. Having con-
verified the mule into money, it is equally
proper and fair to lend out one hundred
dollars OF len per cent. interest per an.
nun, If be finds q borrower ct thst rate.
Money has no intrinsic value; it merely
represents a value by common consent
The man who acquires it honestly cannot
be compelled TO disgorge or she'll out
at q given rate OF interest any more
than the industrious aud prosperous
farmer is obliged to she'll out his
corn to his n~eighbors ct twenty Eve
cents a busheI when the market price is
thirty. Instead Of a benefit TO the agri-
cultural community the proposed repeal
will work a hardship. Whea they have
to borrow the lender will require a
higher rate, aud that in advance, than
ever, and better security TO compensate
for his risk 10 svading the law. Il will
injure all the commercial centers of the
State, and this will react on the people
in every direction. No man who has
looked into the workings Of our financial
and business systems will claim that the
measure in question will enable those
who are hard pressed to obtain accom-.
mOdations at six per cent. per anuum
II must be remembered that all notes are
liable to taxation. which further reduces
the profits Of the holder. We are aware
that in many counties the candidates for
the Legislature pledged themselves to
80 in favor of six per cent. 1t was de-
manded Of them, aud was thought to be
a popular measure. The Governor knew
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