Daily press and Dakotaian. [volume] (Yankton, Dakota Territory [S.D.]) 1875-1880, 1879-02-06

10 - appllCauIo " INC price OF money ~ "
the price of wheat but somehow he believes
the law . fthe state, BY reducing the maxi
mum Interest. may produce low rates Of in,
tsrest and thereby increase the wealth Of
the state" He knows that circumstance
compel business people to be satisfied with
. email margin Of prof., and he cannot dis.
cover why the man who las money to lend
should not be equally accommod ,ting.
HGov. Pillsbury, obeying the dictates OF
his own logic, proposed the enactment Of. a
law fixing the maximum and minimum Of
price Of q bushe! of wheat, or of . barrel Of
four. or of Minneapolis blankets, or of store
goods in St. Paul, or the price Of lots at
Duluth, his friends would consider the pro-
priety Of transferring him to an insane asy-
ium. All these things, it would be said,
must be left t., regulate themselves in the
open market. The proposition would not
be more absurd, however, than is the pro-
posal to regulate the value of money on a
basis to be determined by the value of mon
ey in other places. Minnesota, we are told,
should not pay higher rates of interest than
are paid in neighboring states. What is
possible in Illinois and Michigan should be
made possible, by law, in Minnesota. Gov.
Cullom is a victim Of the same. delusion.
Cities may be left to care for themselves,
he argues, rural districts require the. guar
dianship of the legislature. But what
causes the difference? For reasons which
may or may not be good, lenders prefer the
security Of city property, where business
activity gives greater assurances of value
and availability. TO farm property in sparce
ly populated districts. Hence tho accept
ance Of a lower rate of interest in one case
than in the other. The law cannot obl,,erate
the causes of the distinction, but by DENYING
the right of the lender to act upou the
promptincs of his Judgment, it wjllincrease
the farmers difficulty as a borrower. The
average farmer is not a stickler about the
rate of interest when he seeks the use of
money and be will be likely to prefer the
getting of it at ten per cent to the INABILITY
to get it which the passage Of a rigorous
usury law will produce. The difficulties Of
a Missouri borrower will he still further in.
creased if 1t be understood that legislation
emhodies the spirit manifest in Gov. Phelrs
message. The creditor ia treated as a hard
hearted wretch whom the law should fette,
always and punish when it can: while TIL,
debtor is depicted as a long suffering mortal
who should have the help Of The law in hi
EFFORTS to prevent the collection OF borrowed
We SuOuiu ChfI IN1S III
orthodox Missouri doctrine-so perfectly i,
keeping is it with the practice Of the indeb,
ed counties and Municipalities, and witt
the attitude of the Missouri democracy to
ward eastern people who have money ipves,
ed in that state.
Fsllacious as are the arguments rrcsente'
by these governors in behalf of . leeislativ
crusade against dear money, they have
parallel in the ideas entertained in renar,
to the causes Of the present abundance q
capital and the low rates of in,erestthat orr
vail. In each case it is assumed that tn
supply of money is destined to remain i
excess Of the demand. and, therefore, ths
borrowers will hereafter be able
Obtain it on their W terms. Ii
Governor Cnllom, or Governor Phelps, {
Gov. Pillsbury. come to New York {
Boston, in his private capacity, as a borrow
er, and he will quickly discover his mistak
He will find that the accumulation of id
capital denotes a disordered condition q
f credit which renders the lending of none
almost impossible. There are no great G,
terprises to absorb the capital; CORPORA
loans are not heard Of; business has not r.
gained activity and when borrowers d
appear ordinary evidences of credit al
upaNaiinpiS. 1Nc OdHkS, DelDS cnOke
with money, lend it at call, on securiti,
that are Immediately convertible, The prt
ceeds ofbonds called in for redemption, an
much other capital, ird their way into GU
4 per cent. bonds. Nevertheless. Messr
Cullom, Phelps and Pillsbury would have
hard time if they tried to obtain none,
with no other evidence of fitness as borrow
ers than the ownership of western farm
The fact would then dawn upon them tn:
all the signs Of cheap money which excl
the envy of the west are results of an al
normal state Of things, and will disappe;
whenever confidence shall be re-estahlishe
and business actively restored. Moneye
men will not then be satisfied with four {
six per cent interest; and those of ther
who are inclined to invest in the west wi
either choose states that recognize a reason
able degree of freedom or will exact cond
tions stringent in proportion to the risk il
CURED. The true method of lowering ives
ern rates of interest is to inspire confdene
in the integrity of borrowers and in the at
ministration of the law when contracts al
involed. OF all the governors who or
aloud for usury laws and an enforced redue
ton of interest, not one has touched thi
method of obtaining the benefits desired.
SOUTH CAROLINA ELECTIONS.