Vermont watchman and State journal. [volume] (Montpelier, Vt.) 1836-1883, 1880-02-11

common people, and especially the common
farmers, in whose behalf il was made, have
no political power in that wealthy state.
That interest is taken, and frequently so, by
money lenders there, at rates running from
eight to fifty per cent per annum, is noto-
rious. Butthe power which repealed the law
is strong enough, and probably always will
be, to prevent its re-enactment.
Unfortunately, not only what is called the
moneypower, but also the influence Of the
scientific political economists (who, in
state that pays so much Difference to "cul-
ture" as Massachusetts,, are also power),
is against the regulation of rates of interest
by law. The reasoning employed by them is,
substantially, to the effect that money, like
every other commodity, will be regulated in its
price by the law of supply and demand and
that the only effect OF usury laws is toincrease
the rate of interest by increasing the risks
of the business. The evident answer to this
is that legal tender money, be it coin or pa
per, is not commodity" in any true
sense. The law of supply and demand de-
ponds for its action upon the fact that de-
mand calls out supply, when it is short
by stimulating production. The "fiatists
want to give us that kind of money, but we
have never had it yet. The friends of hard
money" claim that it is of the very essence
of money that the supply should be limited.
The difficulty of obtaining the precious
metals, and their very limited supply, which
is only remotely affected by demand, consti-
tute their chief merit as material for money.
With paper money its strict and prompt
redeemability in coin, which is universally
demanded as the condition of its issuance,
prevents its yielding, except very slightly,
to an increased demand. When, under con-
dtions of on-redeemability, it does yield to
that demand, we have an immediate decline
in its purchasing power as consequence of
the "in6ation.'
The quantity of real money in a country
being practically fixed sum, varying only
slowly, and, so to speak, stiffiy, demand is
not followed by supply, but by an increase
of price. This is not necessarily an evil,
were it not for the fact that money is the
only thing that will pay debt. Here is
another important way in which money diff
fers from what is understood by the term
commodity" If we want wheat, and, the
supply being short, the price of wheat is
high, we may eat something else. Nobody
can harm us for choosing potatoes or corn
in place of wheat. But if we want money
to pay a debt, there is no substitute. Money
we must have, and money we must buy at
the market price, be it ever so dear, or we
must fail" i. e., be ruined, if our debt is
large And these large debts are generally
payable to the very class of individuals of
which we must buy the money to pay them.
Another objection raised against usury
laws, and very cogent objection it is lies
in the fact that they are not easily enforced.
While we recognize fully the abstract justice
of legal regulation of the price of money
that is, of the rate of interest-all expert
ence has shown that such laws are for the
most part imperative, especially under our
form of government. Under an absolute
monarchy they might be enforced, if the
ruler was so disposed. They originated I'M
der such governments, and from thence came
to us. But the conditions here are not the
same. Those not personally interested
that is, those who do not want to borrow
money-are usually quite Indifferent to the
enforcement of such laws. Those who are
in debt and must have money dare not try
to enforce them. The rich, who have money
to lend, are in favor of "free trade in money!"
Of course and since the political economists
have come to their support they, if they can
not repeal, can at least nullify them. As a
proof of this we see nearly every bank daily
and openly violating these laws, while pri-
vate lenders practically name their own
price for loans and generally get it, Prose-
cutions are almost, and convictions quite, I'M
heard Of under this statute. Yet it has some
indirect effect, and for that only is it pre-
served. There are men who, from conscience
or caution, will not take more than lawful
interest. But they are mighty scarce.
The great bulk of debts bearing interest
in this state is due from farmers. We have
no statistics by which we may know how
great the proportion of agricultural indebt-
edness in Vermont really is. Governor An.
drews of Connecticut says that in many
towns in that state three-fourths of all the
farms are covered with mortgages" 1t has
happened to us within a few years to be
commissioned to buy farms for others, and
in our travels for that purpose, in Orleans
and Caledonia countless we have found reason
to believe that what is true in old Connect
cut is true in " New Connecticut" as it was
once proposed to call Vermont. These mort
cages, when given to secure deferred pay
ments, and before the notes have run out
are generally at six per cent Under nearly
all other Circumstances the bulk of them are
usurious. A great many of them are al
eight and ten per cent, and not few al
twelve per cent. Anybody who know,
what the returns of agriculture are in this
state, and especially upon farms where Their,
is a deficiency of capital, knows that sucl
rates of interest for loans upon land ar,
"wilful murder" Hundreds of these farm
have recently been surrendered to the mort
gagees, yet the work has hardly begun
Quite number OF men in the state alread
count the farms that have thus fallen int
their hands by the ten thousand acres
When the settlements shall have been gen
orally completed, the quantity of land so he'll
will be really immense. 1t will be for sal
or to let" and the effect upon the sellin
value of farming lands in the state ca
easily be imagined.
There is plainly no help for the unfortr
mates now under the mortgage harrow
They must ego under" and the great mi
jority of them will never be farmers agair
Those who had no mortgages on their Ian
have probably thought it was small concer
of theirs how their less fortunate neighbol
Jared But now that farms which col
$4,000 are sold for $4,000 land slow of sa
at that, it may strike them that systel
which works such general ruin is worth
the attention even Of forehanded men. "
are, in fact, all in the same boat, and
pretty leaky one it is. We must soon 5,
the Northumberland system taking
firm foothold in New as in Old England.