Spirit of Jefferson. [volume] (Charles Town, Va. [W. Va.]) 1844-1948, 1879-02-18

:
Interest !"
ola the introduction, labor was said to bo the
chief producer of wealth, and the preceding
cnaptsr has been devoted to the consideration
cuapter will exhibit the laws winch govern the
distribution of the wealth, sud will show tho
practical effects OF certain rates OF interest upon
The Constitution of the United States, Art. l,
Sec. 3 and 5. declares, The Congress shall have
power to coin money, regulate the value thereof,
and of foreign coin, and fix the standard OF
| weights and measures" Aeney Is the legal
| standard of value, by which the value of all
articles of sails must be determined. Ihe rate Of
v M the oagt, ~ or i ansg Of ITS a
reri2l. Ms sise of the bnshel IS fired by the
! quantity and quality of Its wood he rates of
Interest maintained upon loans OF money ds-
tsJmines what proportion OF tue earnings OF labor
| shall be pad Ior the use of capital. aud what
proportion shall be paid TO the laborerS Tor their
| productions. If interest on money DO main
tanned at nigh rate ronts ON property will also
| be higB.
There are but two pGrposes to which thes scar
| ly products OF labor can De applied. One is the
| payment of tEe yearly rent or interest on the
| capital employed. ana the other is the payment
of labor. II the laborsrs pay to capital. as use
or interest for the year, their W hole plus pro-
| ducts. the laborcIs, as a body. work for mere
| subsistence, and the capital takes their whole
years toll, food, clothing and shelter only, aud
| THESE, perhaps, of the coarSest kind; while The
canItailst lives IN luxury, increases tue number
| of mis- bonds and mortgages, or with his income
buys land or builds houses to let. which Will, III
succeeding years, taN0 stiil greater SUM from
| On money, rs much governs the rent or use OF
! all property, and consequently the reward OF
| labor. as the law of gravltatlOn governs the de-
| scent of water. If the interest on money be too
| high, a few owDcrs of capital will inevitably
accumulate the wealth or products of tue many.
! With tne present aceumuiatiVc power of inter
est, their is no moro chance Uf tho lab0ring
! classes gaining their rights by combining their
labor TO IncTs&se production than there would
| DO hope OF success that by mblninG their labor
| they could reverse the course OF the rivers aud
| make them Ia the tops of lie mountains and
| pile mp the waters on their summitS The law
| of grIvItatiOn, i'll the latter case. wnnld not be
| more to oycrpnweT all their lahor and
| prOsLTSte all their plaLs than the present gov
gatIreT up tlo inerensed productions and add it
| to tho wealth of cEpitallsts The fault is in the
| lag which governs the distributl0n OF property.
| aud c0mbiGauonS TO increase the pr9auctIoi
| would more effect any change III the dlstTlhu-
| ton than com binatIons against the law Of gravi-
ing powers. The evil Is legislative, and the
| remedy must 30 legislative"
| erty is doubled in certain length of tImep
| determined by the rate of interest. When this
| dou bled IN SO short iirrc that tho borrower is
compelled to give up all his surplus products as
| interest rent; whereas, justice requires that
| he should pay only moderate perceEtace for
| the use of capital and himself retain the chief
| surplus of his labor.
| The following illustration. calculating prop
| erty TO accumulate or double ut certain rates OF
viii clearly exhibit the various esuts to labor
| eTs from various rates of interest: A, Is and
arc Young men. who have just come of age. c
! is heir to S 10000, while aud b are mechanics,
| without cauital. C contracts with and Z to
| oniId house, which shall cost $4,000, on lot
| which 10 paid 5000. The house and lot to-
| getker worth lO.G00. Cleases his property
| 10 aud e, and cLargcs them seven per cent.
| upDn its cost, clear of iDsurance iazcs and re-
! psITs. The lute:est is payable ouce quarter.
| a rate of interest of seven per cent per annnm'
| paI quarterly, viii accumulate q sum equal to
| the principal loaned or invested in property in
| ten years. At this rate, IN ten years and u
another good u house, aud pay tho house and
lot to for the use of the house they occupy In
| twenty years. if and retain the use OF the
house aud its accruinE rents, they must pay
three houses: in thirty years they must pay him
| fifty years. tLirty-ope houses jp si@ty years.
sixty three houses; and in seventy years, one
years all these must be built by ana and
paid to C as the accumulation on the one that
tweuty-seven lots which and Il earn the
money to bny, cost S6S5,0G0, and the buildings
cost an equal amount, making together, Sl,2io-
eco; which sum is paid to G for seventy years
rent Ot one house and lot worth $40 COO. Atthe
expiration of tho lease, the original house must
be returned to it's owner. as well as the rent II
Instead Of being invested in the house and lot.
cent. and tho inteTests were collected aud ie-
| loaned quarterly. the moner would accumulate
in given period precisely the same amount as
| the property.
Now. suppose interest to be at three per cent;
per annunl, and a and to bui Id tile house. and
Ray three per cent. annually on its cost OF
$1,000 This is $500. instead eff S7OO year;
lected and reoaTed quarterly, requires nearly
tw-ntY-four years to accumulate a sum equal
to the principal. Therefore, III twenty-four
years and would give another house in
seventy-two yoars, seven houses, instead of one
hundred and tweuty-seyen which they are com
Pclled 70 do at seven per cent. interest Inc
labor OF building the houses is ueither increased
by high rate, nor diminished by low rate of
| interest.
If Z let his house to and B at six per cent.
| in about twoivc years the income or rent will
equal the principal therefore, at the expiration
| OF that period, a and must pay another house.
and in twenty-iour years, they must pay h1m
| B return him his house. adding one to it it's
| rent and retain two houses as their own surplus
| With forest at three per cent. IN twenty-four
| years aud 3. would each own house aud lot
| worth SlOOpO; while with the interest on money
| both would still be tenants. although they
would have performed, in both cases, the sane
| amount of labor. With interest at three per
cent, in forty-eight years they would give C
| three houses. iostead OF fifteen, as at six per
| cent. and they would own twelve as the sur
plus product of their labor. But six per ceut..
! C's capital would compel a and B to continue
his tenants. and to build for him sixteen houses
more during the next twelve years.
! While l do not agree. by any means. that
tract, from Kc!!oG, to show how the rates of in
| terest on monev-the naked medium for ex-
change of capital-a:Iects all labor, and the pro-
| ducts of labor. which alone constitute capital.
1t " IN be seen. too, that Congress is bound to
the rate Of interest only can fix tie value of
money: This is obvious. as the value of dollar
at per cent. is just double the value of dollar
Row disastrous the rates of and 6 per cont.
are TO the producers of all labor and wealth, is
seen in the above extract. Such rates hand over
| TO the mere tool of exchange. all tie net earn
| fngs of the producers, and lesye but bare sub
| sistence-the wages of tire slave.
Tho not earnings of production, according ia
| the statistics of this country. do not exceed 81
| per cent. Interest should not equal the not
| earnings of labor 1t should be below it.
Money is the sovereign power of the whole
| people; exerted through their common and joint
| stamp; and for the sole purpose Of exchanging
| their labor and products: Now, what IN the
name Of sheFe Justice, should be tho interest,
| charge, for it ! Plainly, just what 1t costs to