The spirit of democracy. [volume] (Woodsfield, Ohio) 1844-1994, 1878-08-20


uated, may combine thousands more, in
common purpose and with a common
interest to maintain their power and pro-
ong their privileges; that these lnslitu-
ions are scattered all over the Republic
md, acting openly or in secret, are able
o influence legislatures, Congresses, and
thousands of voters; it is not injustice,
,ut, on the contrary, it is the expression
If wise anxiety to suggest that such a
system is fraught with danger to the
prosperity of the people and to the pu
'ity Of their government. II, in the
lime of Andrew Jackson, the existence
If national bank with q capital of only
hirty-five millions of dollars, and few
branches here and there, was considered
dangerous to the welfare and the insti-
,utions ofthe country, what shall we say
of wide spread combination of two
thousand national banks, now welding
nearly five hundred millions of capital
and destined, if perpetuated, to vastly
in number, and to control thou.
sands of millions?
8. A third objection to the National
Bank circulation is, that it is special
privilege that puts many millions of dol
lars annually into the pockets OF the
and
TAKES MANY MILLIONS ANNUALLY OUT OF
THE POCKETS OF THE PEOPLE
The general rule is that personspays
interest on what he owes; but, in the
case of bank note. this rule is reversed
The note is debt due by the bank, but
instead of paying interest on it, the bank
is authorized to loan it as money, and
take interest upon the loan. 1t thus en-
Joys privilege that no one else enjoys.
1t draws interest upon its own indebted
ness, and this privilege Of the National
Banks brings them an annual income Of
twenty millions of dollars =
Their aggregate circulation is. in round
three hundred and twenty-five
millions. / think it may reasonably be
assumed that three hundred millions of
these notes are loaned at an average rate
of interest of at least seven per cent. II
SO, the annual interest they receive from
the loan, not of monev, not OF capital,
but of their wn Indebtedness, is twenty
one million dollars. And this sum Is
taken out of the annual product of the
country, before that product is divided
between labor and capital. The general
rule is, that the product Of human indus.
try is ultimately divided between labor
and capital; and when bank note circu-
lation is used the banks first step in, and,
by virtue of their special privilege, take
a large slice in the shape of interest up
on their own Indebtedness. In the case
of our National Banks, this slice, as we
have seen, amounts to twenty-one mil
lions every year Now, if there can be
no sound paper currency but bank notes
then there is nothing left for US but to
bear this burthen or try to reduce the
amount of the exaction. But if the
greenback is as good as the bank note
and nobody denies that il is, why should
it not be substituted for the bank note
and an end put to the exaction2
And, consider further, that for every
greenback il has issued, the Government
has received value That greenback has
paid for services rendered, or material:
furnished, or it has discharged portion
of the interest bearing public debt
There is thus saving to the Govern
ment, or to the people, Of an amount
equal to interest upon the outstanding
greenback circulation ; for, had the green
back not been issued. the Government
would have had the money, by loan Of
taxation, to meet its expenditures, l
it raised it by loan it would, OF course
have to pay interest upon the loan. /
it raised it by taxation, the taxpayer
lose the interest their money would hav,
earned had they not been compelled tt
give il to the Government.
The greenbacks now outstanding
amount to $346, ,6S1, ,016 Computing in
terest upon this sum at the lowest rat
at which the Government can borrow
money, 4 per cent, !, and
WE HAVE AN ANNUAL SAVING TO TIE PEG
resulting from the use OF the greenback
Of Sl3, 1857 ,240 But if greenbacks wer,
substituted for 1922 100000 of Nation
al Bank notes now outstanding, therv
would be a further saving to the peopl
of 4 per cent annually on that sum
namely, S12,SSS, 600 making total an
nnal saving by the use of the greenbacl
of $26, ,747,240. From this, however
deduct the taxes on their circulation b.
the banks, amounting to about thre'
millions annually, and the net saw
, ing would be about twenty,three ant
three quarter millions. Perhaps, il
strictness, this deduction for taxes ough
not to be made, for it is probable tina
the banks throw the burthen of the tax
alton upon their customers, who in turf
shift it to the shoulders of those witt
whom they deal, until, like all other tax
alton, it finally falls upon the great bod,
of consumers, the people.
have thus given you, fellow citizens
some reasons
IN FAVOR OF SUBSTITUTING GREENBACK
FOR BANK NOTES.
now proceed to consider the only ohjec
tion to the substitution that seems to hsv
much weight. 1t is said that if green
backs were to constitute our only pape
currency, its volume would depend upol
the action of Congress, and not upon tn
natural laws CT trade; and that as Con-
gress is liable to be influenced by popula
feeling on the one hand, or the arts ant
appliances of special interests on the 9th
er, the currency would be subject to inf1a
ton or contraction, as either infuenc
might prevail, to degree that would b.
ruinous to business and prosperity.
In answer to this objection, and ad
mitting that it is not without force, ! hav,
to say, in the first place, that it is equal
ly potent whether our paper currency b.
greenbacks exclusively or bank note
exclusively; for, let it be the one or th
other, G ,ngress would have the po,oer tt
expand it or contract it at will. For in
stance, we're Congress to repeal the ta'
on State bank circulation, q multitude o
banks would spring up under State laws
and q great inflation of the currenc,
would take place. On the other hand
should Congress retain that tax and retir
the greenbacks, as the Republican finan
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